HN 64 
.S45 
Copy 1 



The Cause 

of the 

Hi^h Cost of Living 

and the 

Solution. 



BY 



M. SENN. 



The Cause 

of the 

High Cost of Living 

and the 

Solution. 



BY 



M. SENN. 



The Cause 



OF 



The Hi^h Cost of Living 

and the 

Solution* 



BY 



M. SENN, 

w 



PRICE, 25 CENTS, 



Copyright 1914 by M. Senn. 






"To accomplish anything excellent, the 
will must work for catholic and universal 
ends.*** 

Hitch your wagon to a star. Let us 
not fag in paltry works which serve our 
pot and bag alone. Let us not lie and 
steal. No god will help.*** 

"Work rather for those interests which 
the divinities honor and promote, justice, 
love, freedom, knowledge, utility." 

— Emerson. 

"Unless above himself he can 

Erect himself, how poor a thing is man!" 



:.m 19 1914 

Mr 

©CI.A371191 
Ho/ 



INTRODUCTION. 



We are living in a time of general unrest, and everywhere 
questions are being asked regarding the high cost of living, 
and the reason why millions of our people are unable to pro- 
cure even the bare necessities of life. 

Every party claims to have a remeay for our economic 
and political evils, but so far none of them have proposed any 
clearly defined measure for relief. 

There was great demand for an investigation of the money 
trust and we had the investigation. Enough evidence was pro- 
duced to prove conclusively to any unprejudiced mind that a 
combination of great banks, with their interlocking directorates, 
practically controls credits and interest rates, the price of 
stocks and bonds, and, as a natural consequence, the price of 
products and the price of labor. 

We should have obtained some results from this investi- 
gation but we did not. The powfer of combined capital seems 
to hypnotise our press and lawmakers. Instead of going to the 
root of the evil they have passed a law that may give some re- 
lief to the smaller bankers but certainly not to the masses of 
the people. 

My object in writing this booklet is to try and induce the 
voters to demand from their candidates, before nominations are 
made, pledges to support measures that mean radical reforms. 
Only by demanding specific, clearly-defined reforms, instead of 
mere generalities, can the voters ever get results that will really 
benefit them. 



MAN, HIS HIGH CALLING AND DESTINY. 



Man is a wonderful being. His body is the most perfect 
piece of mechanism in existence. Considering only the phys- 
ical form and characteristics of the body it is truly the crown 
of creation; when we further consider the mental attributes 
with which man is endow^ed, there is indeed cause for wonder 
and admiration. 

To be born a human being, with all the possibilities implied, 
is a great privilege. A great mistake in our lives is that we 
do not appreciate more fully our worth and dignity as human 
beings. 

As reasoning beings, the question naturally arises; what is 
the object or purpose of the creation of man? We do not know, 
and yet we are impelled to think about it. 

In our daily lives we meet many difficulties. Sometimes 
our best efforts fail, our plans miscarry. We have misunder- 
standings with our friends, perhaps even with members of our 
own families. Business affairs go wrong or crops fail; work- 
ing men are unemployed or insufficient wages are paid, or worse 
than all we are in poor health. These trials are only too com- 
mon. Under such conditions it is easy to become down-hearted, 
to lose hope, faith and courage and settle into an habitually de- 
spondent condition. This is all wrong. Difficulties, trials, all 
kinds of obstacles and even failures are means of progress 
to the strong man. If we arise to the proper mental attitude 
we learn to view all obstacles as stepping stones to progress. 
We need to take an inward look and try to realise what we 
really are. Are we not children of God endowed with possibil- 
ities greater than any human being has yet attained? Are we 
not placed in this world to develope our faculties, to co-operate 
with our fellow men, to bring peace on earth and love and 
good will to all men? When we bring these thoughts home to 
ourselves, our trials and difficulties become smaller, our cour- 
age rises, our faith and will power increases and we go to 
work with a confidence that the Universal Spirit is with us 
that we can not fail if we do our part. 

Much has been said and written on this subject. The 
Bible says "God created man in his image and gave him domin- 
ion over everything on earth." This is true. The facts prove 
it. Man has subdued the animals, tamed them so they are prof- 
itable to him. He obtains food, clothing and service from them. 
He has improved the wild fruits, the grains, the vegetables to 
better avail as food. He has harnessed the rivers, so they car- 



ry his ships, and furnish power to run his factories. He con- 
trols the lightning and makes a servant of it. From the bowels 
^^ t^Te e^rth he obtains the coal to warm his house, the miner- 
als to make innumerable objects for utility and pleasure. In- 
deed man has subdued and is still subduing the eartn. 

What man has done is only a small beginning of that 
which he can do. We can set no limit to his powers. Every 
man, no matter to what intellectual heights he has risen, al- 
ways feels that there is much more in him to be developed. 

Now all these innumerable inventions have contributed to 
make life more comfortable, and to bring more joy into it. Mere 
living is a joy, at least when the pressing wants are supplied. 
Healthy children who are not spoiled by over indulgence, enjoy 
almost every waking moment of their lives; but they are al- 
ways busy doing something. Their imaginations create, they tax 
their ingenuity to make things. Thus it appears that the law 
of life is thought and action. We may then conclude that one 
purpose of life is joy and happiness, another purpose is our 
development. The desire to know, to do, to create something, to 
excel in doing is one of the strongest traits in a normal child 
or man. Real lasting joy and satisfaction can only be obtained 
through work. As far as we know man is the only being who 
has the desire for self improvement, and the ability to progress. 

Excepting the domestic animals whose form and habits have 
been changed by the efforts of man, the animal world is where 
it was a thousand years ago. 

The greatest progress of man has come from his ability to 
make tools. The invention of weapons gave him the power to 
control animals. With tools he was enabled to cultivate the soil, 
build shelter, roads, bridges boats and ships to sail the seas. 
The last century has been especially fruitful in innumerable in- 
ventions of labor saving machinery. 

We can now truly say that man is gaining dominion over 
everything on earth. Yes we are justified in believing that man 
partakes of the all prevading creative spirit; that he was created 
in the image of God. 

This ability to invent tools, machinery, scientific instruments, 
chemical combinations, everything that increases man's power 
over the forces of nature, insures to humanity still greater re- 
sults in the conquest of natural obstacles to continued progress. 

With our marvelous industrial and scientific progress the 
ideal of our destiny as a nation has also enlarged. The faith 
and hope of a Golden Age or millenium, where crime, poverty 
and ignorance shall be no more is deeper and stronger than 
ever before. 

It is the spiritual nature in man that has carried this hope 
and inspiration of a Golden Age, down through the centuries. 
Through all the ignorance, oppression deprivations, and suffer- 
ings of humanity, this hope of a better time, the kingdom of 
heaven on earth, has found voice in the Prophets, Seers and 
Poets of the race, and has lived in the hearts of the people. 

6 



CAUSES THAT OBSTRUCT PROGRESS. 



Man is a two sided being. He has the animal wants and 
passions and the higher spiritual aspirations. When under the 
influence of his animal nature, he is selfish and tries to satisfy 
his wants and gratify his passions by any means. Primitive 
man satisfied his hunger, if there was no other way by taking 
from his fellows by force or stealth; but gradually his higher 
nature impelled him to make efforts to subdue and control these 
selfish animal desires. The family instinct began to develope. 
Mother's love which sacrifices and gives instead of always want- 
ing to take, probably furnished the first example. Man learns 
more from example and observation than by any other method. 
How could man see the daily manifestation of mother love, the 
willing sacrifices, even of a savage mother for that most help- 
less of all beings at birth, her baby, without being stirred within 
by a desire or resolution to do something for his children, his 
wife, his fellow men. 

Men began to win wives by love instead of taking them by 
force. They formed family groups and made attempts to pro- 
vide food and shelter for them. As man listened more and more 
to the higher spiritual impulses planted within him, the con- 
ception of duties, not only to his family, but to his fellow men 
gradually began to enlarge. Men grouped themselves together 
for self protection. Tribes and nations were formed, but always 
the strong took advantage of the weak and while there was some 
progress, some improved conditions for all, there would be a rul- 
ing class which would manage to live in comparative luxury and 
idleness on the labor of the many. 

Among the northern nations where the severity of the cli- 
mate stimulated the minds of men to invent means to procure 
shelter and clothing, and to store food during the long winter, 
progress was faster, The masses gained more rights from the 
ruling class and finally in our country we gained equality in pol- 
itical rights and privileges, for the white race at least. Later 
by a fearful sacrifice of money and lives we gave equal rights 
to the black race, and still later will give it to all of our women. 

This proves that deep down in the human heart there is 
implanted a sense of justice, a love of freedom that can not be 
eradicated by centuries of oppression. But human progress and 
especially progress towards greater liberty and a higher con- 
ception of justice seems to swing somewhat like a pendulum. 
So after the great moral awakening which caused the Civil War 



the pendulum of progress seemed to swing back again. We have 
sadly fallen from the high position the founders of our govern- 
ment took in the Declaration of Independence. We have lost the 
substance and kept the shadow. Our experience since the Civil 
War has demonstrated that oppression can assume many forms. 

Since chattel slavery was abolished another form of slavery 
has been established. 

It is stated that the so called Hazzard Circular was sent 
by Hazzard an English banker to American bankers in 1862. To 
my personal knowledge it was largely circulated in newspapers 
in the seventies. I submit a copy: 

"Slavery is likely to be abolished by the war power, and 
chattel slavery to be destroyed. This I and my European friends 
are in favor of. For slavery is but the owning of labor and 
carries with it the care for the laborer, while our plan is for 
capital to control labor by controlling wages. This can only 
be done by controlling the money. 

The great debt that capital will see to it is made out of 
this war must be used as the means to control the volume 
of money. To accomplish this, the debt must be bonded and the 
bonds must be used as a banking basis. We are now waiting 
to get the Secretary of the Treasury to make the recommenda- 
tion to congress. It will not do to allow the greenbacks to cir- 
culate as money for any length of time; for we cannot control 
them, but we can control the bonds and through them the bank 
issues." 

Judging by the financial legislation enacted during the 
Civil War and since then, the policy recommended by the Europ- 
ean bankers through the Hazzard Circular has been faithfully 
carried out. 

During the civil war while the majority of people were prin- 
cipally occupied and interested with the war, the building of 
what we commonly call the money power was fairly started. 
The high protective tariff and the enormous demands for the 
army stimulated all kinds of industries tremendously. Fortunes 
were made in a short time especially in government contracts. 
The era of railroad building also started during the war, and 
the policy of giving land and bonds to new roads was then 
inaugurated. However, the greatest impulse for the accumu- 
lation and concentration of wealth came through the manipula- 
tion of the finances. I will not enter into any details, only 
state that the banks obtained the entire control of our finance 
policy, and have fortified their position ever since. Now they 
are all but omnipotent, and it remains to be seen how long a 
patient public will submit to their absolute dominion in the field 
of finance. 

The investigation and report of the Pujo committee is of great 
value, not immediately, because the recommendations they make 
do not go to the root of the evil but the publicity given bank- 
ing affairs will arouse a healthy indignation and impel many to 
think and act. 

8 



There is proof that a few great banks largely control the 
credit of the nation; that they have it in their power and freely 
use that power to cause a rise or depression in the price of stocks 
and bonds on the stock exchange; that they make enormous prof- 
its besides their large profits as bankers, by their stock gambling 
— yes gambling with loaded dice. The enormous sale of watered 
stock, 50,000,000,000 — Tnink — could not have been accomplished 
without the aid of these banks and their influence on the stock 
exchange. 

This combination o£ capital takes the form of protective tar- 
iff, land monopoly, especially in mines and forests, transporta- 
tion, telegraph and telephone monopoly, also combinations of 
manufacturers to maintain excessive prices by mutual agree-- 
ments and last but greatest of all Finance and Banking monop- 
oly with allies of c earing houses and stock exchanges. By these 
methods a large portion of the greatly increased production of 
the country is diverted from those who really earn it, into the 
pockets of a comparatively few. The natural result is enormous 
fortunes for a few and poverty with all its sad consequences for 
the many. Much has been said and written about these evils the 
last few years, but I am sure that very few even well informed 
persons have any conception of the enormous amount that 
Capital takes from labor through these monopolies. In another 
chapter I give figures. 

Now the masses are beginning to see and feel that there 
must be something seriously wrong in our economic machinery. 
People everywhere are asking why is it so hard to make a liv- 
ing? Why are there so many obliged to go without sufficient 
food and clothing when there is always an abundance in our 
warehouses? What is the reason of the increase in the num- 
ber of criminals and paupers? Why is there a constant increase 
in the number of our people without homes? Why are the un- 
sanitary tenements in our large cities crowded with the families 
of the poor, and why does every new census snow an increase 
of mortgaged homes and renters? Why do we have fabulous 
fortunes for the few and constant increase of poverty for the 
many? 

Thoughtful men and women are trying to understand why 
there is hunger when our farmers always produce an abundance 
of food, or raggedness when our manufacturers make plenty of 
clothing. We are never in want of material to build houses nor 
do we lack mechanics to build them. In short we are not only 
able, but actually do produce an abundance of everything needful 
for man. There is now no good reason for hunger or want in 
any form. We are ready to deny the old saying that poverty 
must always exist. We will no longer believe it is God's will, 
but believe the injustice and selfishness of man is the real cause. 

Whatever interferes with freedom interferes with the 
proper development of man. First and fundamental is the op- 
portunity to make a living, to provide himself and family wiih 
the daily needs of life. Hunger and want stop or at least re- 
tard higher progress. Usually abject poverty degrades; ambi- 



tion, self-respect and hope are destroyed, body and mind in- 
jured. Therefore a civilized government should above everything 
else see to it that the means to earn an honest living by work 
are not monopolized; should jealously guard the rights of every 
citizen against all manner of oppression. 

I go one step farther and declare that the government should 
help the man v^ho is in danger of falling below the line of self- 
support and provide work for him so that he may keep his self- 
respect and remain a useful member of society. The government 
should also provide means and methods to educate all children 
whose parents or guardians can not so they may become self- 
supporting. 

So we see that injustice is the cause of our economic evils. 
When a naan robs another on the street or breaks into his house 
and steals his money, or goods, Vv^e call it a crime and punish 
him. But if one man or a number of them obtain special priv- 
ileges by which they gain enormous sums through all manner 
of complicated devices, from the labor of others, we have not 
yet found the means to successfully prevent it. 

That is the mission of our age — we must have justice in our 
economic relations, we must prevent the unjust encroachment 
of organized greed, as we prevent common stealing. 



10 



WHO IS TO BLAME? 



We have ceased to believe that God wills poverty, and we 
do not altogether blame the rich. We the masses of the people, 
the big crowd are beginning to see that it is our own fault that 
we have a government which is controlled by the mighty Dol- 
lar,. We have neglected our duty as citizens; we have not used 
our brains and especially have we failed to recognize the bond 
of brotherhood between all men. 

Yet we must not become despondent or desperate about these 
conditions. That would bring no good results. The only way out 
is by patient, careful study of the situation. We must find what 
is wrong, and then work tenaciously and perseveringly to right 
the wrongs. 

To sum up in one sentence, the wrong in our economic and 
political life is that the people in power have been and still are 
money mad. Perhaps we needed the motive of acquiring great 
wealth to stimulate the captains of industry to exert them- 
selves in overcoming the innumerable obstacles in the realiza- 
tion of their plans. 

But if the stimulation of the acquisitive faculty was neces- 
sary earlier it surely is not any more. It has rather been 
overdone. What we need now is to turn over a new leaf. 

We want to understand that life is greater than wealth, 
that conditions that promote natural, healthy environment for the 
masses are of greater importance and value than conditions 
which promote immense fortunes for the few with poverty and 
misery for the many. We are beginning to see that if we want 
to be a great nation, we must become a nation of strong, intel- 
ligent, happy home loving, and home possessing individuals. 
Yes we see more clearly than ever that great riches as well as 
extreme poverty is destructive to the real progress of humani'^y. 

There is no disguising the fact that any radical change that 
really strikes at the root of special privilege, must be advocated 
and supported by the masses. Take for instance the agitation 
against slavery. For years and years it could not be 
brought to the attention of the masses. Even the churches 
would not take a stand against it. A few devoted persistent agi- 
tators kept the question before the people, gained a few adher- 
ents here and there, until finally the leaven had worked through 
the masses. Then no power, no politicians, no party, could pre- 
vent the final outcome. So will it be with this even greater 
question of economic justice. 

11 



But we must know definitely what we want. We must stop 
going into campaigns on generalities, or from frenzied enthusiasm 
follow a popular hero. 

A square deal, justice to all, progressive measures, tariff re- 
form, finance reform, flexible currency, better conditions for the 
workers, relief for the hard conditions of the farmers, are nice 
phrases but count for nothing unless accompanied with clear spe- 
cifically defined propositions. 

We must bring out definite issues and every candidate 
must clearly and unequivocally pledge himself to support them, 
then if we win an election' we will get what we worked for. 

The politicians will compromise and evade real issues until 
the people speak in no uncertain voice. We must not for- 
get that we have had railroad commissions for twenty-five years, 
but have so far accomplished very little except in a few states. 
All our trust busting has so far accomplished nothing. 

The priviledged class defended by a powerful press, the 
most able lawyers, and politicians, with unlimited means and 
influence to intimidate and bribe, though small in numbers are 
almost invincible in their position. But if the masses are really 
in earnest and w^ork out what they want, show that they un- 
derstand their needs, and also know their power, there will be 
plenty of true and able men coming to the front to lead them to 
victory. 

The cause of reform would be hopeless, except for the great- 
est of all reasons, the most stupendous fact in the universe, 
namely, the innate God implanted sense of justice and the love 
of freedom in man. 

Issues may be obscured; false leaders may obtain the con- 
fidence and admiration of their followers, come into power then 
betray their trust; through money and trickery good laws passed 
may be made ineffective for a time but eventually right will 
prevail. 

The demand for economic justice, the right for every indi- 
vidual to obtain the value of his work, indeed the right of ev- 
ery person to have an open opportunity to obtain work can not 
much longer be denied. 

All that is needed is for us, the common people to feel and 
realize, that we too are human beings created with inalienable 
rights to life, liberty and the pursuit of happiness. That no power 
in the universe can deprive us of our God given rights, if we earn- 
estly and persistently demand and work for them. There is im- 
planted in the very nature of our being, in our blood and bone 
the principle, that we must work for what we want, that we 
must strive for that which we desire, that we must feel and 
assert the worth and dignity of our own individuality, if we ex- 
pect to be successful in our efforts. 

Too many of us have been in the habit of forgetting or ne- 
glecting our duties as citizens. We have failed to assert our 

12 



own manhood, our own citizenship. Too many have only a blind 
partisanship to guide them, instead of an active sense of obli- 
gation to an honest, intelligent performance of the duties of ci- 
tizenship. 

There must be a radical change in this respect. If we really 
want a government of the people, for the people, and by the 
people, we can not blindly follow leaders who conlinually work 
against the common interest. I am anticipating that the vote of 
the women will be a strong influence for good. 

Women are not so blinded by the party spirit as men are, 
they have almost an instinctive knowledge and distrust of laws 
and measures that are destructive of home and family life. 
Then there are probably more well educated women than men. 
Women generally speaking are more inclined to improve them- 
selves intellectually after leaving school than men, and their 
club meetings I think are more often for mental improvement. 
Last, but not least if real v/ant comes a woman suffers more 
from unjust laws than man, because a mother will sacrifice and 
endure everything for her children. 

The voters must train and use their own judgment, 
must be discriminating in what they read in newspapers, 
and above everything else must organize and study and under- 
stand public questions. 

A government that really exists for the good of all, that 
does justice to all, that protects the weak against the strong 
not only from physical injury but also in the economic struggle 
has so far only been an Ideal to strive for. 

We the people of this nation have had a grand and inspiring 
dream, since the noble founders of the government sent out to 
the world that wonderful document the Declaration of Independ- 
ence, but the realization the application of the principle to ac- 
tual conditions, especially the economic life of the people is 
still unrealized. 

But there are signs of a new awakening and the issues in 
coming campaigns will be economic questions that go to the 
root of our evils. You and I the common people, the farm- 
ers, merchants, mechanics and professional men, must know 
that it is a work for us; that we cannot be indifferent, cannot 
afford to be ignorant; that we must use our intelligence and rea- 
son if we want truly a people's government. 



IS 



WEALTH. 



By the term wealth I mean all exchangeable products of la- 
bor that have a market value. Capital is that part of wealth, 
Which is not consumed but used to produce more wealth. 

If we would consume everything we produce, there would 
be no capital, and to have civilization we need capital. Wheat, 
corn, oats, hay etc., lose six to ten per cent of their weight in a 
year's time, besides rats, mice and insects injure them. Clothes 
shoes, furniture, houses, in fact nearly all classes of raw 
material or manufactured goods, except wine and whis- 
key deteriorate in time. When men have any form of wealth 
that they do not need for immediate consumption they usually 
exchange it for money. 

Money is the most convenient form of wealth; it needs small 
space to store, has little weight and is easily transported, does 
not deteriorate in time, as nearly all other forms of wealth do. 
Yet money is not wealth in itself. It Only represents wealth, be- 
cause it can be exchanged for it. 

Money is the best medium of exchange, because it has by 
edict of law a staple value, not absolutely fixed as compared with 
products of labor, but absolutely fixed in value for paying debts 
interest and tax:es. 

We may truly state that money has been and is one of the 
most useful factors in promoting commerce and industry. 

But just because money is so easy to keep, so easy to trans- 
port, and so convenient to exchange again for other forms of 
wealth, it soon became the most desired object in the world. 

From this naturally followed, that a thing so valuable as 
money, might be loaned for profit, instead of simply used as a 
medium of exchange, and of course interest was charged and 
paid. Now in obtaining interest for money loaned, the foundation 
was laid for debts. Money does not produce money, does not 
really produce interest; a man borrowing a hundred dollars at 
ten per cent interest may be able to pay one hundred and ten 
dollars in a year but he must earn the extra ten dollars by some 
special effort. As a rule interests are not really paid, but are 
added to debts or appear as new debts. That is the reason that 
in all countries debts are steadily increasing. 

Ancient writers seemed to see the evils of interest taking 
more clearly than the modern writers. • 

15 



The Bible writers of the Old and New Testaments severely 
denounce usury: "Take thou no usury of him, or increase; but 
fear thy G-od; that thy brother may live with thee. Thpu shalt 
not give him thy money upon usuary, nor lend him thy victuals 
for increase." Lev. 25. 36, 37. 

Augustine one of the prominent early church fathers says: 
"If you lend money to a man and expect to get more than you 
gave you are a usurer and in that respect reprehensible not 
praiseworthy." 

Aristotle says: "The practice of receiving interest on money 
is detestable, as by it the increase of fortune arises from the 
money itself, and not by employing it for the purpose intended". 

Shakespeare says: "He who is in debt is a slave." 

It is this unnatural attribute of increasing money through in- 
terest that has paved the way for the accumulation of the enor- 
mous fortunes of modern times. When interest is compounded it 
has a power of increase that seems incredulous. One dollar at 
8% amounts to $2,203.00 in a hundred years. It is mostly 
through the power of interest that debts are created. Debts 
mean the enslaving of future generations. The burden of debts 
the American people have put on the backs of their descend- 
ants is the saddest and most appalling fact to contemplate. 

It is this wrong use of money that has led our people in 
to the almost bottomless mire of debt, that has put the blight 
on our industrial life, so that instead of peace, happiness and 
general prosperity among the masses, we have increasing strife 
and discontent, poverty, ignorance, vice and crime. We have 
such unnatural conditions that even the farmers are to a large 
extent dissatisfied and prefer to leave the farms and move to 
towns. 

All this is not because we cannot produce an abundance of 
everything needful for men. We always have enough but the 
masses have not the means to buy. We hav.^ cnocked up the 
channels of distribution through monopoly, mostly money and 
banking monopoly. 

In our present industrial condition there is a great demand 
for capital to build permanent improvements, schools and their 
belongings, churches, railroads, manufactories with their ma- 
chinery, stores and warehouses with their contents. The farm- 
ers especially in a new country have always need for better 
houses, barns, graneries, fences, windmills, farm machinery and 
tools. The township needs road work, culverts, and bridges; the 
county and state governments continually require buildings. 

All these demands must be supplied by the savings of the 
people or by making debts. They can not be supplied by what 
we consume, but only by the surplus after we have supplied 
our immediate necessities. 

The character of our people, the greater freedom under our 
form of government, with the unlimited natural opportunities of 

16 



our country have developed a wonderful working power in our 
people. We produce more wealth per capita than any other 
nation. Our workmen work fast; where machinery is used it 
is run at high speed. In pure hand labor such as husking 
corn or picking cotton requiring apparently only simple move'- 
ments we have developed such expertness and speed, that a 
person who has not acquired skill while young can never attain 
it. 

I think the reason for this is the greater freedom and con- 
sequently more marked individuality of the children especially 
those raised on the farms. Children like to excel and are quick 
to see new actions, clever to imitate and if possible to improve 
on them. In work or play they constantly aim to be first. By 
these traits the ingenuity and inventiveness of the growing gen- 
erations have been developed and a working power unequalled 
in the history of the world has been transmitted. 

Think of it, try to grasp the full meaning that in Kansas 
all our cities, all our farms with their splendid improvements, 
all our roads, bridges, public buildings, our school houses and 
churches, have been produced by the labor of our people in less 
time than the span of one man's life. 

"But while making this wonderful progress in the production 
of everything that makes our country a fit habitation for man. 
thereby promoting his physical, mental and spiritual develop- 
ment, another growth of the nature of a parasite has also de- 
veloped and devoured the largest portion of the fruits of labor 
viz., the financiers with their usury, the board of trade where 
speculation in produce stocks and bonds is carried on, and 
schemes for the monopolisation of the sources of wealth are 
hatched. 

With the increased power of production caused by the su- 
perior working power of our people and the invention of labor 
saving machinery, the production of wealth in all branches of 
industry and on farms, increased very fast. More wealth is cre- 
ated than in any previous period in the history of the world. Yes 
we have produced, and do produce, more wealth per capita than 
any other people on earth. 

Who gets it? Do we see it in the more comfortable homes, 
better clothing and better food for the workers — no, a thousand 
times no. When Charles Dickens visited the United States (in 
1854 I think) he wrote "The American working man eats meat 
and wheat bread three times a day. I have not seen a beggar 
on the streets since I came here." Would he write that if he 
could come back now and visit our manufacturing cities? 

I do not wish to harrow your feelings by descriptions of the 
condition of our working men in our manufacturing districts. 
You can get that in our daily papers. The whole nation is 
alarmed about it. Thousands of well-meaning, charitable people 
are trying to alleviate some of the sufferings. The innumer- 
able strikes, riots, labor wars, armies of strike breakers, private 
armies of detectives and thugs, calls for militia or United States 
troops, tell the story. 

17 



How about the farmers? They surely are prosperous. Read 
the statistics of the value of the crops they raise, the fattened 
cattle and hogs, the horses and mules they sell, the hundreds of 
millions they get from the sale of poultry, eggs, milk, butter 
and cheese. Read the advertisements of the land boomers, and 
you will feel like buying a farm and getting rich. Yes these 
figures are imposingly large, but take your pencil and divide 
them by the number of workers on the farms, and the result 
is the farmers get less for their work than the average wage 
earner in factories. I am not stating this to set the farmers and 
wage earners against each other. Their interests are the same, 
they suffer from the same causes. The bad influence of our pres- 
ent currency and banking system on our industries and the in- 
justice perpetrated on the workers, can not be adequately stated 
and understood without serious reflection, can not be fully 
grasped until the mind becomes gradually prepared for it. 

However, the merely financial injury, the loss to the work- 
ers in dollars, is the more insignificent part compared to the 
ethical injury sustained by those who reap the gain of the sys- 
tem, as well as by those who are the financial sufferers from it. 

No person can be the beneficiary of injustice without injury 
to his character; the man who gets money simply by financial 
manipulation, soon loses the true perspective of real life. He 
sees value only in money and the power it brings him. The de- 
sire to get more and mors becomes unnaturally stimulated and 
grows stronger as it is indulged. When a man gets to the front 
or to the top in the financial struggle, he sees more clearly 
that the financial rewards do not entirely depend on real ef- 
ficient work in shop, factory or farm, but that money can be 
made easier in influencing and controlling prices through stock 
manipulation. This is and has been the undeniable drift and 
nearly all the bank and large business failures can be charged 
to speculation. 

The old saying, the love of money is the root of all evil, is 
true. It is grounded in human nature. It is the ever present 
battle between our better and nobler impulses with the lower 
passions. In other words the love of money means the desire 
to have power over our fellow men, to control their action and 
make them subserviant to our will. 

Our present finance system is the modern substitute for 
feudalism; to govern the masses through financial manipulation 
instead of simply using brute force. Our financial system is the 
culmination of devising ways and means to control the fruits of 
labor by devious hidden methods that blind the masses to the 
truth. 

Perhaps the greatest evil effects of money obtained with- 
out giving service in return are the temptations toward idleness, 
an implied superiority over those who perform useful labor, 
excessive luxury and dissipation injurious to body and mind. 

Our system of banking and finance with its concentration 

18 



of capital and credits gives the rewards of wealth not to ini- 
tiative in starting needed useful industries, not to the best man- 
agement of a factory, shop or railroad, but to the most success- 
ful speculators who win not by chance of gambling, but by gamb- 
ling with loaded dice, by careful and skillful planning, by con- 
tinued lying advertisements backed up by fictitious sales; often 
these really criminal transactions go even farther. Large div- 
idends are declared and paid where there is no profit until the 
public is made to believe that shares in the so much advertised 
corporation are really valuable and buy. In many instances hun- 
dreds of millions are made by simply issuing new stocks or 
bonds and pocketing the proceeds. 

Such practices are undermining the character and morals of 
our people. No one would even pretend that a people could sup- 
port and maintain themselves by gambling. What must be the 
influence of practices that give the bulk of the nation's 
wealth to gamblers through financial manipulation, aided by mon- 
opoly privileges and the constantly active power of interest. 

The rich ease their conscience by giving to charity; condole 
themselves by giving part of their ill gotten wealth to the 
poor. The poor by receiving charity lose their self-respect, their 
courage, hope and self-reliance. By and through this false sys- 
tem the great mass of people deteriorate for lack of opportunity 
to support themselves by honest labor. 

The opportunities for the poorer and middle classes to marry 
and obtain homes are decreasing from year to year. Renters 
are increasing in the large cities, in the smaller towns, and on 
the farms. The independent, self-reliant mechanics, merchants 
and farmers are gradually growing less in numbers and influ- 
ence. 

The more educated professional classes are trained in con- 
servatism and usually use their intellectual ability to defend ex- 
isting conditions, rather than expose existing evils and devise 
remedies. The influence of wealth over institutions of higher 
learning is almost overwhelming, and is degrading in its char- 
acter. 

Because we have developed a system of acquiring wealth 
through speculation and monopoly privileges and have given to 
money the unnatural power of increase through interest, we see 
that wealth, which, when rightly used, is a good thing, has be- 
come a bad influence, and a menace to our further development. 



19 



STATISTICS. 



We had in the United States in 1910 a population of 92,- 
174,515. And an aggregate wealth of $120,000,000,000, which 
makes the average wealth of our people about $1,300 a person. 

The value of aU farm property is given at $40,991,449,090; 
the number of farms 6,361,502, making the average value of each 
farm $6,435. 8,565,926 persons were working on farms in 1890. 
In 1900 the number of farm workers was 10,381,765. In 1890 
there were hired laborers 3,543,970 this leaves 5,561,865, farm 
owners and renters. 

Any practical farmer knows that a large amount of work is 
done on farms by the wives and children; cultivating, ploughing, 
hoeing, corn-husking, cotton-picking, milking and other chores, 
boys and girls help with on many of the farms. Most of the 
farmers' wives, besides the regular house work, raise and care 
for poultry and vegetables, and make butter; occasionally, when 
the need is urgent, even field work is performed by them. Ac- 
cording to the best of my judgment and of many farmers I 
have talked with, there should be 50% added to the number of 
farm workers not hired, for the work of women and children. On 
this basis we obtain for 1890, 11,346,858; for 1900, 13,367,209. 

For 1910 I have been unable to obtain statistics of farm 
workers, but taking the same increase ior farm workers as 1890 
to 1900, which is considerable less than it would be on the basis 
of in crease of population, we have 15,396,433 workers on farms 
in 1910. 

There is another serious error in the statistical report of 
values of produce raised on farms. Everything raised and sold on 
a farm is counted in the census report, field crops, fruits and veg- 
etables, horses and mules sold, animals sold for slaughter. Beef 
pork, poultry, eggs, milk, butter and cheese are the principal 
income on many farms. 

Corn, oats and hay are principally fed on the farms to the 
teams to perform the farm work, to the cows to produce milk, 
to hogs and cattle to produce beef and pork, to poultry to produce 
eggs, and to growing horses and mules. The value of this corn, 
oats and hay appears in the horses, mules, cattle, hogs, poultry, 
butter and eggs sold by the farmer. I can find no statistics 
showing the proportion of corn, oats and hay sold from the farms. 
My judgment, and that of many grain dealers and farmers, is 

. ti 

21 



the farm or by farmers in the near vicinity and the value ap- 
pears in the stock and produce. 

The corn crop of 1910 is given at 2,886,260,000 bushels, farm 
value, $1,884,817,000; oats, 1,186,341,000 bushels, value $408,- 
388,000; Hay, farm value, $747,769,000; Wheat is a 
large item in the value of farm products. There ought to be 
a reduction of 10% in reporting the value of the crop, as an av- 
erage of 10% is always used again for seed. The farm value of 
the wheat crop for 1910 is given at $561,051,000. So we have 
a correction: 

On value of corn % $1,038,612,750 

On value of oats % 306,291,000 

On value of hay %. . 560,826,750 

On value of wheat 1-10 . 56,105,100 



$1,961,835,600 

This makes the value of farm produce for 1910, $6,732,164,- 
400; instead of $8,694,000,000 as reported by the 1910 census, 
Rye, Barley buckwheat and potatoes are often fed to farm 
animals, but we will let that pass. 

Here we obtain the average of $437.00 income for each farm 
worker in 1910, when farm products had a high value, and 
newspapers and everybody else was shouting about the pros- 
perity of the farmers. In 1900 when farm products were lower 
on the same basis of figuring, we find the remuneration for each 
farm worker was $345.00. 

Some may think, considering the farmers pay no rent, un- 
less they are renters, that since the milk, butter, eggs, chickens, 
potatoes, vegetables and fruit they eat are not counted, they are 
fairly well paid. But we must also consider there is an av- 
erage of $80.00 of interest to pay on each farm and about $50.00 
of taxes. This would reduce the average pay to each worker 
to a trifle over $300.00. Besides this, the farmers have con- 
stant cash outlays for repairs and replacing worn out farm ma- 
chinery, repairing and painting building^, keeping up fentes; if 
a grain raiser, twine bills and threshing expenses. Where is 
the Ye turn for the forty billions invested in farm property? 

• Now these figures are averages, as accurate as they can be 
obtained. I know very well that many farmers realize much 
larger returns for their labor, but that does not alter the situa- 
tion. Farmers differ in ability like other people; if many farmers 
obtain better results for their work, then others must necessar- 
ily have less, because the total is given by the census report. 

The stupendous fact remains, that the class of people who 
do the hardest, most useful and indispensible work receive a 
meager living for their labor, and no return for the capital in- 
vested. That is the true cause of the tendency of the farmers to 
leave the farm and move to town. 

How about other branches of industry? The summary of 

22 



manufacturers for 1909 gives the total capital invested at 
428,270,000; the number of wage earners and salaried men, 7,- 
405,313; total wages paid, $4,365,613,000; cost of material used, 
$12,141,791,000; value added by manufacturers, $8,530,261,000. 
This leaves a balance in favor of manufacturers, over cost of 
material and cost of labor, of $4,164,648,000 — 23% on the in- 
vested capital; average pay for salaried men and wage earners 
a year, $589. 

From this it appears that all manufacturers earn $1,789,- 
097,000 more by employing 7,405,313 men and $18,428,270,000 cap- 
ital than the 15,386,433 workers on farms using $40,991,449,090 of 
capital. 

The manufacturers, after paying their workers and raw ma- 
terial, have the nice little sum of $4,165,641,000 left for pin 
money. 

The farmer buys from the manufacturer the finished pro- 
ducts, the manufacturer from the farmer the raw material; that's 
mutuality; but the division of earnings seems somewhat unequal. 

The railroads for 1910 report stocks and bonds $17,981,454,- 
000; net earnings, $919,062,312; over 5% on capital, about half 
fictitious. The railroads employ 1,699,420 men and pay an av- 
erage wage of $673, a year; 

In the Treasurers report for 1911 we find. National banks 
7,163; State banks, 12,843; Saving banks 1,884; Loan and Trust 
Companies, 1,251. The combined capital is $1,919,085,741. 

These fragments of statistics ought to furnish food for 
thought. We see that the farmers with more than double the 
investment of the manufacturers get no returns for their in- 
vested 40 billions, while the manufacturers get $4,365,613,000 
over the cost of material and labor, and gives larger wages to 
their working men than the workers on the farms get. The 
railroads on less than half the capital invested in farms, and 
their capital is admittedly about half water, have net earnings 
of nearly a billion. Incidentally I notice that railroad profits 
are smaller than manufacturers because the people have begun 
to curb them. 

But when we come to our banking system we come to the 
real source of our difficulties, the root of the tree of evil. Here 
we find a system that with less than 2 billions of capital, 20 
times less than what is invested in farms, 9 times less than 
what is invested in manufacturing or railroads, absolutely dom- 
inates the interest rates and credits of the country. 

These banks and Trust companies with their comparatively 
small capital have discounts and interest bearing bonds of over 
17 billions; over 8^/^ times more than their capital. And what is 
called their capital is almost entirely made up from their sur- 
plus, added to capital from time to time. They pay large div- 
idends to stock holders but still add hundreds of millions of sur- 
plus annually to stock. 

23 



Even this does not represent the full extent of the evil. 
It is through the power and influence of combinations and groups 
of banks that selling of worthless stocks which have no real 
value is accomplished. This was proved by the investigation of 
the Pujo committee and by statements made by Thomas Lawson 
and other authorities on the subject. 

Thomas Lawson in Everybody's magazine, states that since 
he began his operations on the stock exchange, $40,000,000,000 
of fictitious paper, or watered stocks and bonds have been sold 
through the exchange. John Moody, an authority on this subject, 
covering a longer period of time, states that the amount of water 
in securities sold is $50,000,000,000. 

Let us pause a moment and form a conception of what it 
means to have fifty billions of fictitious stocks and bonds sold 
to the public. 

The average net income on stocks or corporations is, accord- 
ing to the report of the commerce commission 5Vs%', this on 
$50,000,000,000, makes a tax on the public of $2,666,666,660 annu- 
ally. A sum so great that the human mind fails to grasp it 
except by comparison. 

It is a sum more than double the value of the entire corn 
crop; over four times the value of the wheat crop; more than 
three times the value of the largest cotton crop ever raised; 
three times the value of all the lumber products; and greater 
by $600,000,000 than all the coal, iron, lead, copper, gold and 
silver and all the other minerals mined annually. 

It is a sum more than eight times greater than the pay 
of all the teachers of our schools and colleges; it is as much as 
500,000 laborers can earn in a year; and greater than the sum 
that 500,000 families have to consume annually. 

Now this enormous sum is received by a comparatively 
small number of persons for absolutely no useful service ever 
performed; and it is in such shape that as long as present con- 
ditions remain, it continues practically forever. Our children 
and children's children are enslave. 

Think it over from every point of view, then you will begin 
to see the principal cause of the high cost of living and the 
evil consequences that ensue. 

We will now try to find as nearly as we can the rewards 
in money for those who do the work in our country. We find 
that on all the farms in the United States in 1910 there were 
15,386,433 workers who produced $6,722,164,400 worth of farm 
products, an average of $437 a person. The number of wage 
earners in manufacturing establishments was 7,405,313 the wages 
paid, $4,365,613,000. Railroad employees, 1,699,420; the wages 
paid, $1,143,725,306. 

Here we have employed as farmers and farm laborers, as 
workers in manufactories and on railroads, 24,738,095; that 
leaves 10,246,929 workers in other occupations, where earnings 

24 



are not given. Among these are laborers not specified, 2,629,262; 
servants and waiters, 1,560,721; clerks and copyists 630,127; dray- 
men, hackmen and teamsters 538,993; salesmen and saleswo- 
men, 611,139; dressmakers 346,884; seamstresses 150,942; tailors 
and tailoresses 229,649; teachers and professors in colleges 
446,133; this leaves over four millions to about 120 various oc- 
cupations, according to the census report. 

Most of these ennumerated belong to the class who receive 
small wages; even the teachers in the common schools, thous- 
ands of them in the south, receive less than $300 a year. The 
average of teachers wages is said to be only $485.00. Even 
among ministers, there are thousands who receive less than 
$500.00. Of course professors, doctors and lawyers, get higher 
salaries, but their numbers are comparatively small. So I think 
if we average the wages of all these 10,246,929 workers at $500.00 
we are about right. This makes a sum of $5,133,464,500. 

Now we have as remuneration for all the workers on farms 
$6,722,164,400; all the wage earners and salaried men in man- 
ufactories, $4,365,613,000; All the railroad employees, $1,143,- 
725,306; balance of workers wages estimated, $5,133,464,500; 
Annual Total return to all forms of labor,$17,363,967,206; aver- 
age return to each worker $500.00. 

Now we will try and find out the amount of returns capital 
obtains. 

Rent from buildings in cities $2,220,000,000 

Farm rents / 767,000,000 

Interest on bank discounts 1,142,000,000 

Interest on farm mortgages. 496,000.000 

Interest on Nat'L, State and municipal debt. 140,000,000 

Interest on corporation bonds 1,608,176,000 

Interest on notes to private money loaners. 576,000,000 

Net income of railroads 919,062,000 

Income of manufacturers 4,164,648,000 

Total income of capital $12,032,288,000 

The city rent statistics I obtained from the World's Al- 
manac for 1912, from figures of taxable property given there, 
taking the District of Columbia for a basis, which gives rented 
buildings 76%; owned 24%. In the larger cities the proportion 
of rented buildings is probably greater. I took 8% on a tax 
valuation of $27,750,000,000. I think real value is higher. 

Farm rents I figured on a basis of 37% of farms said to be 
rented, took % value of products raised as given in census report 
for 1910, Share rents vary from ^^ to i/^ of crops raised, cash rent 
is usually on a lower basis. Interest on bank discounts I fig- 
ured at 7%, in many states they are over 10 %; interest on 
farm mortgages at 8%; interest on bonds 5%. 

Interest on debts to private money loaners is an estimate. 
There are always many loans made outside of banks, of large 
proportion at a fair rate of interest; but a large business of 

25 



loaning is done in all parts of the country by so called money 
sharks at rates that are a disgrace to a nation. In 1888 I think 
the commissioner of labor for Kansas, made an extended in- 
vestigation and in a detailed report gave names and amounts of 
loans in a number of cities in Kansas, showing interest rates 
in many instances of over 200%. Accounts of such extortions 
by money loaners appear quite often in newspapers and occa- 
sionally prosecutions are made, but the evil flourishes in all parts 
of the United States and laws are ineffective against it. Lately 
I saw a notice in a paper, which I quote. 

Boston, October 29, 1913.— "How a net profit of $24,000, on 
a capital of $1,000, was made by a Chicago company in four 
years in the small loan business, was told on the witness stand 
today at a trial for violating the small loan act. Miss Helen 
M. Foster of Winthrop, testified that four years ago she was 
engaged by mail to transact the company's loan business in this 
city and received $1,000 as capital. Since then she had sent 
back $24,000 to the head of the concern in Chicago." Accord- 
ing to common report this business is very flourishing right un- 
der the eyes of our government in Washington. 

One large item of interest is omitted, that would more than 
balance any errors in interest charges. The mortgages on city 
property are undoubtedly very large but I have seen no statistics 
regarding them and will leave the subject. 

Another large item of debts not ennumerated here are debts 
that are due merchants. There is always a large volume of such 
debts, especially for farm machinery. These debts are usually in 
notes and carried by the merchants, so they do not appear in the 
bank statements. Then I have been unable to obtain figures of 
the dividends of Insurance Companies, Street Car Companies, 
Water Works, Light plants. Navigation Companes, Express Com- 
panies, Telegraph and Telephone Companies. 

There is no doubt that the income from capital is much 
larger than the figures I give, probably nearly half of the re- 
turns that labor obtains. 

Unfair and unjust as is this robbing of industry by capital, 
the sums taken by these methods are only a small portion of the 
injury perpetrated. The recipients of income from capital are 
comparatively few in numbers, and most of them spend only a 
small amount of their income the balance they re-invest again. 

As long as business is in a prosperous condition and in- 
vestors have confidence, all this new capital from savings is 
used in new ventures, so that labor is fairly well employed and 
manufacturers and merchants find a market for their products. 
But when the more cautious and better informed bankers and 
capitalists know that the indebtedness of the country has come 
to a point where it is dangerous to further increase debts, they 
refuse credits and use all means to decrease their outstanding 
debts. Then these savings of capital are not loaned and used in 
employing labor, but appear in commerce as under consumption. 

26 



In other words, those who have the income do not wish to buy, 
the average income of labor is reduced from unemployment, and 
the result is a large number of the consumers have not the 
means to buy. 

This condition reacts first on the retail merchant, then on 
the jobbers and manufacturers. As their business decreases, 
they are forced to discharge some of their employees and the 
evil of underconsumption grows worse. If capital would use 
their surplus income in employing labor, then the wheels of in- 
dustry and commerce would turn again in the usual order, or if 
the government would employ idle labor as I suggest in another 
chapter. 

This is the condition we are in now, and it will continue 
with increasing bankruptcies and general shrinkage of values, 
until debts are largely liquidated and manufacturer's stocks re- 
duced. 

Think of it. To all who perform useful services with brain 
and hands. $17,363,967,206. 

To capital without performing useful service, $12,032,288,000. 

59% for useful efforts. 

41% for privilege, interest and monopoly; and still writers 
on economics and politicians blame the high cost of living to 
almost every cause except the principal cause, that capital takes 
the lion's share and charges it to the price of goods, or takes 
it from the workers. 

Am I my brother's keeper? 

Are we living in a free country or are we slaves? What are 
we going to do about it? 



27 



WHAT REWARD SHOULD CAPITAL HAVE? 



The question," what should capital have, is very important. 
We \vi 1 consider capital under two forms, as money loaned 
out and as capital invested in farming, manufacturing, or com- 
merce. A large proportion of farmers, manufacturers and mer- 
chants, seem to be obliged to use borrowed capital. We will 
not moralize here, nor will we discuss the question of interest 
in the abstract. We are simply considering facts and condi- 
tions as they now are. 

The evolution of money and banking, as we have it now, 
has a long history. Banking is a good devise, adapted to the 
needs of modern business. Money is an artificial thing, that 
by common consent, and legal enactments, is a legal tender 
for payments of debts and taxes. It is also a medium of ex- 
change; for money a person can obtain almost everything that 
is made; with money one can hire almost any ability or brain 
power in existence. 

The working man tries to turn his labor, the professional 
man his knowledge and skill, the. artist his accomplishments, into 
the common medium of exchange — money. The farmer must 
raise crops and after preparing the soil, sowing the seed, cul- 
tivating, harvesting, threshing and hauling to market, he ob- 
tains the object for which he worked — the money. The manu- 
facturer has often a very complicated process. He must buy 
raw material, he must have buildings and many kinds of ma- 
chinery, must put his raw material through many processes, 
and finally gets it finished, sold and the money for it. The mer- 
chant has a shorter but still a very complicated process, until 
he turns his efforts into money. 

In farming, manufacturing and merchandising, the person- 
al element, the judgment, energy and working power, are all 
important factors. Success or failure often hinges on a single 
item. If a farmer has some better way of doing things, or 
uses more improved tools or machinery, his neighbors will see 
it, imitate him and gain by it. The same principle operates 
with the manufacturer and merchant. In all these avocations 
there are great risks; with the farmer important factors are 
the influences of weather and the ravages of insects and epidem- 
ics among his live stock. The manufacturer has to contend with 
breakages of machinery, change in style of goods, new inven- 
tions that make his old machinery useless, fluctuations of mar- 
ket, etc., considering all this, it seems fair and reasonable that 

29 



if a man by better management makes greater profits he is 
entitled to the benefit. 

It is only when through the largeness of operations and 
especial cunning, parties obtain monopoly privileges, that we 
should interfere. 

The point I desire to make is that capital, invested in any 
kind of productive industry, is always taking risks, and the 
returns are influenced by these unlorseen risks, and by the abil- 
ity, judgment and efficiency of the management For this reason 
profits are justified and even needed as an inducement for men 
to engage in the various industrial enterprises. 

Now the returns from these ventures, when completed, ap- 
pear in the form of money; the largest part is always used in 
living expenses, but in the aggregate, there are large sums 
saved: It is impossible to obtain exact figures on that subject. 
One financial authority claims the savings of capital available 
for re-investment annually in the United States is $800,000,000, 
Farmers use most of their savings for new improvements on 
their farms, although there are large sums of savings loaned out 
by farmers. Of course these loans by farmers would not be in- 
cluded in the above stated sum. 

Observe that returns, profits or savings to capital in the 
various industries, can hardly have an injurious influence on the 
welfare of the people, except as those engaged in these indus- 
tries acquire monopoly privileges. The re-investments of profits 
in enlarging plants, in putting in improved machinery and 
farm improvements, is rather a benefit to the community than 
an injury. It is when savings are re-invested again, in the form 
of money loaned out, that the injurious effect on the commun- 
ity begins to appear. 

It is a well known fact that when people loan money they 
are very careful to have security that insures the interest and 
principal beyond any reasonable doubt. The figures I gave in 
the preceding chapter prove that, on an average, farmers ob- 
tain no profits from farming, hardly decent w^ages for their work. 
They have only their living for their work. This applies to 
farmers where land values are not rising. In a few states they 
obtain considerable advance on the price of their farms, but that 
is a temporary condition, and does not help the farmer who 
does not wish to sell, does not increase crops nor cause higher 
prices. On the contrary it has an evil effect on the farmers, as 
it stimulates and encourages the speculative spirit. 

Judging from observation and experience and the statistical 
reports of failures by merchants, most of them have a hard time 
to make ends meet. So it is with the small shops and manu- 
facturers. In short, the capital invested in farms, in stores, in 
small shops and small manufactories brings generally small, and 
frequently no returns at all. It is only when we come to large 
concerns, where they have obtained special privileges, that large 
profits appear. Even averaging up all the savings of the nation, 

30 



including the enormous profits of privileged business, the aver- 
age saving of the nation is below 2%. 

Population in 1870, 38,558.371; wealth, $30,068,518,000; per 
capita, $779. Population in 1880, 50,155,783; wealth, $43,642,000,- 
00*^'; par capita, $850; increase of wealth 9.1%. Population in 
1890, 62 947.714; wealth. $65,037,091,000; per capita. $1,038; in- 
crease 22.03%. Population in 1900, 75,994,575; wealth, $88,517,- 
306.775; p?r capita, $1,164; incr^^se 12 14%. Population in 1910, 
92,174,515; estimated wealth, $120,000,000,000; per capita, $1,300; 
increase 11.68%. 

This makes an average increase of wealth for 40 years of 
1.373%. Only a little more than 11/3% per year. 

In view of these facts, it only needs common sense to see 
that when money loaned out brings on an average three to 
four times greater returns, than unprivileged business can earn, 
than the average of all the people can save, that we have per- 
mitted an element to enter into our industrial system that can 
only bring ruin, bankruptcy and panics. 

It will not do to say that everyone has a right to make all 
he can. There is and must be a limit to the grasping of wealth. 
We muFt not forget that capital, while it obtains wealth, does 
not produce wealth. Capital grows either by rent, often obtained 
by owning high priced land in large cities, the value of which 
has been created by increase of population rather than any ef- 
forts of the land owners, by interest and dividends or profits, 
obtained through special privileges, such as tariff or rebates 
on freights or agreements on prices. 

We must make a distinction between those who possess 
and still are accumulating, enormous fortunes, who obtained 
and still obtain them, simply by the power of capital, through 
rents, dividends or largely watered stocks, and interests and 
those who save through better management, greater industry 
and economy. They are usually the most useful people, and their 
accumulations can never become dangerously large except 
through the power of interest. 

In other words we positively must squeeze the water out of 
stocks, abolish special privilege and have a money and bank- 
ing system under which idle money (that is, money which the 
owners do not need in their avocations, and do not wish to 
invest on their own account) can not bring returns in the form 
of interest, greater than business without special privilege can 
possibly earn. Money must be the servant, not the master of 
our industries. 

It is altogether too much to expect, under our present bank- 
ing system, which controls credit and interest, and through them, 
wages of labor, a lower rate of interest can be obtained. The 
tendency at the present time seems to be for higher interest 
rates. Those who enjoy special privileges never voluntarily sur- 
render them. So far, it has been impossible to pass laws that 
have effectively regulated interest. Nearly every state in the 

31 



Union has laws regulating interest, but there is not a locality, 
not a town or city, without its usurers who fleece those in real 
distress by charging interest rates far above what the law allows 
and often as high as 200%. 

Even the banks, at least many of them, violate the law 
and take more than legal interest. Of course they insert the legal 
rate of interest in the note, but the discount may be much 
larger than the legal rate. The note must be paid or renewed 
when due, so the interest rate, inserted in the note, is only a 
blind. 

A worse form of getting more than legal interest is 
practiced by many bank officers, to such an extent that the 
comptroler of the currency in his report of 1911, made the fol- 
lowing statements and recommendations on the subject of officers 
of National Banks receiving commissions for compensation on 
loans made by their banks. "An amendment forbidding any 
officer of a National Bank to directly or indirectly receive or ac- 
cept money or other valuable thing from any borrower from 
the bank of which he is such officer, should also be enacted. 

The dishonest practice by officers of National banks of re- 
ceiving personal compensation from loans made by the bank, is 
a growing evil and has already reached such proportions as to 
call for criminal legislation on the subject. In this manner 
either the bank is defrauded of la.wful interest, which it would 
otherwise receive, or usurious interest is exacted oi a borrower 
by a corrupt officer. A secret reward to the officers is sometimes 
a deliberate bribe for obtaining a loan on insufficient security. 

It is recommended that the taking or accepting of money, or 
other valuable thing, by any officer of a National Bank for his 
own personal use as a reward, inducement, or consideration for 
obtaining the loan from the bank of which he is such officer, 
shall be made an offense and punished by imprisonment in the 
penitentiary. 

A law should be enacted determining the period during which 
any person can be prosecuted, tried or punished for offences un- 
der the national bank act." 

Occasionally some persoij, or paper, makes an exposure, 
some arrests, even convictions, are made, but a change in method 
follows and again the robbery is carried on. 

There is only one way to prevent usurious interest and that 
is by government assuming and conducting the entire money 
business of the country. There can be no half way measures 
about this. The entire evil system must be rooted out. Only the 
government through its officers must be permitted to receive de- 
posits and loan money. 



82 



WATERING STOCKS AND BONDS. 



Modern industrial progress, with its rapid growth and im- 
mense profits, has stimulated the love of money to a fever heat. 
To start new or enlarge old enterprises, always demands more 
money. The largest portion of all manufacturing, transportation 
and mercantile business is transacted by corporations. The 
money needed is raised by selling stocks and bonds. 

It is a common practice, when a trust is formed, that is, 
when a number of private concerns, partnerships or corporations, 
sell out to a trust, to increase the capital stock, often 3 to 10 
times the real value. If the business is prosperous then, after 
a while this surplus stock, which is real y not needed in the bus- 
iness, is listed on the stock exchange and offered for sale. 

This method of acquiring wealth is very tempting. There 
is a tendency in all of us to try to get something for nothing, and 
most men have a sort of admiration for those who can do this, 
especially when it runs into millions. 

Fortunately or unfortunately, depending on our own stand 
point, the true laws of business, or the natural laws of the uni- 
verse, do not permit such actions to go unpunished. It creates 
disorder and inharmony. It violates the true law of reciprocity. 
Everyone should give value for everything he gets. Nothing else 
can really satisfy. 

We are now" beginning to reap the fruits of this evil doing. 
Everywhere people are complaining and inquiring about the high 
cost of living, about the hard conditions in which the masses 
are compelled to live. We all know there is something w^rong, 
but that is not sufficient. We must know definitely just what is 
wrong, and how to right that particular wrong. I think, if you 
follow me in this inquiry, you will find out. 

Most of the stocks and bonds are sold through the New York 
stock exchange, but they can not be listed there until certain 
rules and regulations of the stock exchange are complied with. 
It is commonly believed that stocks or bonds listed on the New 
York stock exchange are safe and sound. The very fact that 
they are listed there is considered almost a guarantee of their 
value, and bankers and other money loaners accept the quota- 
tions of stocks and bonds as a basis for securities. 

Usually there are groups of banks that underwrite new is- 
sues of stocks and bonds. After banks have agreed to float 
certain stocks and bonds, perhaps bought them outright, it be- 

33 



com'^s their business to create an active demand for them. For 
this purpose the stock exchange offers the best opportunity. The 
machinery for that purpose is all there. At the daily sessions, 
under an inconceivable excitement and noise, the stock brokers 
offer their wares for sale. This proceeding is repeated in a small 
way in thousands of cities all over our broad land. A ticker, 
so called, an electrical contrivance which gives the sales of the 
various stocks and products as fast as electricity can travel, is in 
every room. 

This business of gambling in stocks, bonds, v/heat, corn, 
cotton, pork, lard and butter, probably uses more money, de- 
mands more credit, ruins more business men, all through our 
land, than anything else. It has been developed, encouraged and 
advertised in such glowing ways, that the lambs, as the vic- 
tims are called, flock in, in a constant stream. The buying and 
selling of things, merely for speculation, does not increase values. 
What one gains, another must lose. Besides it requires large ex- 
penses to conduct this business. It needs very expensive appar- 
atus, buildings, offices and men. The privilege of doing business 
in the stock exchange of New York costs from $50,000 to $75,000 
a seat; in smaller cities proportionately. Such services are paid 
in the form of commissions. 

Games of chance are very attractive to human beings, but 
in this country public opinion has decreed that they should not 
be permitted and we have passed laws against gambling. Still 
there is gambling, and professional gamblers have invented 
methods such as marked cards, loaded dice, secret accomplices, 
by which they almost surely win. This is considered very dis- 
honorable. But the Board of Trade where millionaires gamble, 
where the largest and most powerful financial interests are 
deeply involved, is considered very respectable. 

Besides the exposures of Thomas Lawson in Everybody's 
magazine, we have now the very valuable report of the Pujo com- 
mittee to bring incontestable proof that groups of banks join 
together to buy millions of stocks and bonds, and form what are 
called pools. This means that they agree to buy and sell about 
the same amount of these stocks every day; buy a little more 
than they sell, when they want the stock to go up; sell a little 
more than they buy when they wish the stock to go down. 

There is one instance given by a sworn witness before the 
Pujo committee, viz. The Columbus Coal and Iron Company. 
The price of this stock through these manipulations, was forced 
from 24 to 92 1/^ in the course of nine months. At that time the 
company was earning only half of one per cent. Later the price 
broke in a few hours from 88 to 25, bankrupting three firms and 
causing heavy losses to many others. 

Another case is the California Petroleum Company with 
$32,000,000 of stock. A group of bankers, 104 in number, (a) 
three corporations affiliated with National Banks, (b) one trust 
company in New York, (c) 24 oflEicers of banks, among them of- 
ficers of four national banks in New York, two in Chicago, one 

34 



in Detroit. In this deal the bankers made a profit of $1,784,338 
in cash and $2,572,845 in common stock, which they sold later at 
40 and 45. This profit was made before the stock was placed 
on the stock exchange. After operations commenced on the ex- 
change, stock rose from 50 to 72 in 21 days, there were 362,270 
shares sold, over 3i/^ times the amount of all the stock. 

After examining many witnesses, several former governors 
of the exchange, the committee states "The practices thus ap- 
proved by the author'ties of the exchange, not only deceive the 
great body of the public, as to the true state of the market, and 
v/het their appetite for speculation, but debase and make impos- 
sible of fulfillment the high office of the exchange as a register 
of the current values of securities, and draw from the channels 
of legitimate trade and commerce millions of the country's cap- 
ital." 

Without going into any more details, I will conclude this 
subject by stating that the Pujo committee report proves beyond 
all reasonable doubts that the great banks controlled by J. P. 
Morgan and Company, First National Bank of New York, Na- 
tional City Bank of New York, Lee Higginson and Company of 
New York and Boston, Kidder, Peabody & Company of Boston 
and New York, Kuhn, Loeb & Company, New York, have been 
the agents of concentration. They have 118 directorships in 34 
banks and Trust Companies; 30 directorships in 10 insurance 
companies, 105 directorships in 32 transportation systems; 63 
directorships in 24 producing and trading companies; 25 direc- 
torships in 12 public utility corporations; In all 341 director- 
ships in 112 corporations, having a capitalization of $22,245,- 
000,000. These banks have negotiated stocks and bonds since 
1905 of $3,607,512,637. 

It was also proved that the various groups of banks never bid 
against each other, not even when new issues are offered. If 
a corporation issuing stocks or bonds starts to do business with 
a bank, they must continue with the same bank. 

It is evident from these facts that these groups of banks 
to a large extent, control not only the price of stocks and bonds, 
but also the rate of interest. Legitimate banking makes large 
profits, but the enormous profits that these associated banks 
make, some of them over 1,000% on the original capital, are 
not the result of regular banking, but flow from commissions 
and profits from dealing in stocks and bonds, and from their 
united power to influence prices on the stock exchange; in other 
words, from gambling with loaded dice. 

As an example of profits made by banks prominent in these 
transactions, I give the history of the First National Bank of New 
York. The history of J. P. Morgan's bank would probably be 
still more interesting, but not being a National bank it is not 
available. 

The First National Bank was organized in 1863 with a cap- 
ital of $300,000, which was increased the next year to $500,000 
where it remained until 1901, when it was increased to $10,000,000 

35 



■ — 100,000 shares— through the declaration of a special dividend 
of $9,500,0000 — 1900^/r on the existing capital stock. The sur- 
plus is now $15,000,000; and undivided profits $5,896,827. George 
F. Baker is the ruling spirit. From 1874 until recently he was 
President, and is now chairman of the board of directors. 

Besides doing the ordinary business of a National Bank, it 
acts as an issuing house for corporate securities, usually in 
syndicates with other such houses, rarely a^one; it is a large 
lender of money on the New York stock exchange. From 1889 
to 1901 dividends were p?id at the rate of 100 per cent per an- 
num on a capital stock of $500,000. | In 1901 there was a divi- 
dend of $10,750,000—2,150 per cent— $9,500,000 of which was de- 
clared for the purpose of increasing the capital stock to $10,000,- 
000. Yearly dividends on the increased capital stock have been: 
1902, 1903 and 1904, 20Vr; 1905, 26V^%; 1906, 2634%; 1907, 32%; 
1908, 126%; 1909 and 1910, 28%; 1911, 38% 1912, 33%. 

From these figures we see that these banks, who control 
credits and interest rates, are not sufferers in times of panic. 
They know when panics come; they can make them. They 
reap the richest harvest when others are in greatest financial 
distress. 

National Banks are by law not permitted to deal in stocks 
and bonds, and the comptroler of the currency had advised the 
jfScers of the First National Bank some years before. Not wish- 
ing to conflict with the law, these gentlemen organized a Se- 
curity Company with the same officers, the same board of di- 
rectors, doing business in the same building. They must be 
law abiding and respectable in order to retain the confidence 
of their customers. 

The stringency of the money market and inability of mer- 
chants and manufacturers who can offer good securities to bor- 
row money, is undoubtedly largely caused by the enormous de- 
mands for money from speculators. Bankers who make the enor- 
mous profits stated above, naturally prefer to use their money 
where they obtain the greatest profits. The amount of money 
loaned in New York for speculation on the stock exchange, can 
not be ascertained, but 32 banks and trust companies who have 
been examined by accountants of the Pujo committee showed 
that $766,995,000 of loans were made at that time. Of course 
there were many more loans as 32 is only a small proportion 
of New York Banks and Trust Companies. 

Other evils of our banking system: While bankers are 
well organized and co-operate together against any attempt to 
abridge their privileges, they are not exempt from human weak- 
nesses and imperfections. Their calling tends to stimulate self- 
ishness and avarice. Jealousies and envy are often very active 
between rival banks. If an opportunity offers to cause a run on 
a rival bank by helping or even starting unfavorable rumors re- 
garding their financial conditions, bankers have been known to 
participate in. such actions. 

36 



All large cities have clearing houses. Briefly stated, the 
process of clearing is as follows: At the beginning of each bus- 
iness day each member presents at the clearing house all checks 
against other members deposited with it up to the close of bus- 
iness of the preceding day. Accounts are stated and in the af- 
ternoon every debtor member brings the amount due from it to 
other members, to the clearing house, which on the same day 
pays it over to the creditor members. 

In 1911 checks to the amount of $92,420,120,091.67 averaging 
$305,016,897.99, daily, were collected through the New York clear- 
ing house Association. It required only 4.7% of the money that 
would otherwise be involved in the transaction. 

Only banks with at least $1,000,000 of capital can become 
members of the clearing house, but smaller banks are permit- 
ted to clear through a full member bank. However, the priv- 
ilege of clearing may be withdrawn at any time. In October 1907 
two Brooklyn banks clearing through the Oriental Bank, a full 
member bank, were refused the privilege on one day's notice 
and the next day they both failed although as proved later on 
they were both solvent. 

The same arbitrary and seemingly spiteful methods are pur- 
sued by the clearing house regarding clearing house certificates. 

I quote from Pujo Corhmittee report. 

"At times of extreme stringency in the money market not- 
ably in 1893 and 1907 they have issued to members without 
authority of law, on the security of their assets so called loan 
certificates, which without payment of the circulation tax of 
10%, passed as currency in some cities as in New York, only 
amongst the members to pay balances at the clearing houses, 
but in others amongst the general public as well. In 1907 up- 
ward of $250,000,000 of such certificates were issued." Again. 

"In the absence of governmental control, as at present, they 
also place a dangerous power in the hands of clearing house 
associations, which determine to whom, the certificates shall be 
issued and when they shall be retired. As the associations in 
this regard act through small committees, a bank will often find 
the decision upon its application for assistance resting with its 
keenest competitors, with no right of review." Again. 

"Thus in the panic of 1907, the Mechanics and Traders 
Bank a member of the New York association, with deposits 
around $12,000,000 was compelled, like many banks in good stand- 
ing to apply for aid in the way of clearing house certificates. 
The Mechanics and Traders applied for and obtained clearing 
house certificates to the amount of $2,100,000 giving collateral 
having the face value of $6,373,252.52. Subsequently on January 
25th 1908 (Mr. Woodward having succeeded in the meantime as 
chairman) the Mechanics and Traders and three other banks 
were notified by the clearing house committee, that these out- 
standing certificates must be retired within a certain time. The 
notice was published in the newspapers, and a run on these 

37 



banks ensued, resulting in their closing. Within 40 days the 
Mechanics and Traders Bank paid its indebtedness to the clear- 
ing house association in full." Again. 

"91 clearing house associations, including those of nearly 
all the larger cities, requires members to charge a specified rate, 
uniform in each association for collecting out of town checks, 
except those drawn on banks at certain named points. In the 
New York association which is typical of this class the penalty 
for the first violation of the rule is a fine of $5,000 and for the 
second expulsion." 

One other instance: "The clearing house association of Salt 
Lake City has adopted amendments investing the association, 
not only with power to regulate the rates for collecting out of 
town checks, the rates of interest on deposits, and the rates of 
exchange, but also such matters as the hours for opening and 
closing, and even the amounts that should be charged for check 
books. The Pittsburg association has a similar amendment 
pending." 

These quotations from the Pujo committer report give only 
a small idea of the work covered, and I would ask all who really 
desire to obtain reliable information on the far-reaching evils 
of our finance and banking system to obtain a copy and read and 
study it. The unfortunate part about this report is that the 
committee, after being in possession of all these facts from rec- 
ords and sworn testimony, made very tame recommendations 
to Congress which did not reach the root of the evil. Then the 
house passed the Glass Bill, about which no two men have the 
same opinion regarding the probable effect, and which leaves out 
entirely the most important question of helping the people to get 
more reasonable interest rates. 

Strangest of all, the public press and our politicians are 
practically dumb on this most important subject. I hope and 
trust that the women, who are voters now, will have more good 
common sense than men, about this greatest of all questions 
which effects the high cost of living. It seems the men are all 
hypnotized by fear of offending the money power. We, the 
common people, the great mass, might as well understand that 
those who enjoy special privileges and through these privileges 
rob the masses, will never surrender one iota until our poli- 
ticians and the press, hear our insistent demands for a definite 
fundamental change in our system of finance and banking. If we 
want a government for the people, then the people must act, 
must study and understand what they want, then work to get it. 

Another thought in this connection: The enormous sums of 
money made by these transactions, of booming stocks and bonds 
by regularly planned campaigns of speculative sales, to load on 
to the public worthless or, as commonly called, watered stocks, 
is shifted onto the broad shoulders of the masses and appears in 
various forms. It may be in smaller salaries or wages, or higher 
prices of the things we must buy. So are the very large sums 
of commissions the bankers get for marketing bonds and stocks, 
as well as the, great sums of interest collected. 

38 



The largest portion of these billions are absolutely taken 
from the public, stolen we might properly say, without giving 
value in return. The saddest part of all is, that this burden is 
not only for us as long as we live, but for our children and their 
children practically forever. By permitting this monstrous evil, 
we are practically enslaving our descendents. Debts in the ag- 
gregate are not paid, they are constantly increasing, must in- 
crease, because the interest rate is above the earning capacity of 
the nation. Of all the crimes, the crime of saddling debts onto 
the coming generations is the blackest. When a man makes a 
fortune by useful inventions, by a great scientific discovery, by 
great works of art, or even by making two blades of grass 
grow where only one could grow before, there is some fairness. 
But fortunes that are being piled up through these shady finan- 
cial manipulations, even if they are legal, are robberies, pure and 
simple. 



39 



THE REMEDY. 



I have shown in preceding chapters how interest, being 
double to treble the amount of what business without special 
privilege or farming can make, is the principal cause of the high 
cost of living. That it can only be paid out of the products 
of labor, that it will cause lower wages under same conditions, 
and higher prices to consumers under other conditions has been 
proven. To reduce interest rates by law is impossible, since 
such laws have never been enforced. 

Banking for public good, instead of banking for private profit, 
is the only solution. The best thing about this proposition is 
that, besides overcoming the opposition of those interested in 
private banking, there are no serious difficulties to overcome. 
We hear much talk now about public ownership of railroads, and 
it will probably come some time. The magnitude of that undertak- 
ing would be very much greater than public ownership of bank- 
ing. 

The capital stock of all banks and trust companies is less 
than two billions; the stocks and bonds of all railroads about 
nine times greater; the number of persons employed by railroads 
about 5,000 times greater than those in banks. The executive 
ability, scientific knowledge and technical skill required for the 
successful operation of a railroad is incomparably greater than 
the requirements of these qualities for successful banking. 
Banking consists, principally, in exact bookkeeping, and good 
judgment regarding the financial standing of borrowers. Of 
course, banking as it is now conducted, requires a certain ability 
of a very high order, to satisfy greedy stockholders, who are 
only concerned with obtaining large dividends; and refusing dar- 
ing promoters who offer large commissions to bank officials in 
order to obtain loans on shady securities. This kind of ability 
would not be necessary in banking for the public good. 

If it were not necessary to first arouse the people to over- 
come the united opposition of all the big and little capitalists, 
the herd of politicians and the influence of most of the great 
papers, public banking could be inaugurated and the people 
would not be disturbed in their business pursuits. Customers 
of a bank would, in all probability, find the same faces at the 
bank counters when they came to transact business, because the 
government, would naturally want men of experience in their 
employ. With no desire to make profits there would be no diffi- 
culty about managing banks. The difficulties and failures of 

40 



banking under our present system result from the desire to make 
large profits. The bank officials understand that, and know that 
their usefulness and salaries depend on the profits they can 
make. On that account they are tempted to take risks in loan- 
ing to promoters of doubtful projects. Speculators are the men 
who are willing to pay high rates of interest and large commis- 
sions or shall we call them, bribes. Very often it is through 
officials of a bank, directors, close friends or relatives, that 
doubtful loans are made. All this would be obviated with gov- 
ernment banking. There would be only one consideration; to 
take all reasonable precaution that loans were safe, and with 
that point guarded, every one would be served alike. 

There would be a central board of directors for general sup- 
ervision; and a local board of directors for each bank, familiar 
with local conditions, who would study the question of security 
and consult with the bank officials. The central board should 
make rules that would be posted in every bank. These rules 
ought to give the rate of interest paid for time deposits, probably 
2% as postal banks pay now. The rate of interest charged for 
loans should I think be 3% . This of course would only be ten- 
tative. Careful observation and systematic study, would in the 
course of time give knowledge, and experience to determine just 
what rate of interest would be best for the greatest benefit for all. 
This rate of interest would undoubtedly leave a surplus which 
ou^ht to accumulate until it was considered sufficient to cover 
any occasional losses that might occur. 

There should be no credit given to speculators, or gamblers. 
If they must gamble let them do so with their own money. The 
general policy would be to induce men to reduce their debts 
whenever practicable. However to honest, striving men, deeply 
involved in debt, but possessing means to work out in time, all 
possible consideration consistent with safety should be given. 

One class of borrowers should be encouraged. That is, men 
who have saved a little money and want to buy or build a home 
in town or country . I consider there is nothing of greater im- 
portance to a nation than to encourage and assist men to become 
home owners; and when a man has been saving some of his 
earnings, the government could well afford to loan the balance 
on an amortization plan. By this method, paying less than in- 
terest rates now charged, a man could pay interest and principal 
in 30 to 35 years. This could easily be done by paying 5% an- 
nually and in about 30 years the debt would be paid, and he 
would be the owner of a home, by paying less than he would 
have to pay in rent now. 

For instance, consider a house that would cost with lots, 
$2,000. A man should be required to possess at least $500; that 
would necessitate a loan of $1,500 at 5%, of $75 a year, probably 
about half of the usual rent charged now for that class of a 
house; and he would be paying interest and principal at that 
rate. A man buying a farm would pay only about half as much 
in interest as now, and still reduce, and finally pay the debt, with- 

41 



out special effort. He could buy and pay for a farm by paying 
less annually than the average rent paid now, save the expense, 
time and effort to find a new place to rent, and the cost of mov- 
ing. On all such loans, the privilege would be granted to pay 
off the debt sooner, at the option of the debtor. 

The much reduced interest rate, resulting from public banking, 
would greatly assist in making public improvements. Under 
our present system, after bonds are voted, there is usually quite 
a large commission to some bank to sell the bonds. This would 
all be done away with. 

The greatest benefit of public banking would be that it 
would offer an effective remedy for panics. Public banking can 
not prevent bankruptcy. Parties who can not manage their busi- 
ness must ultimately fail; but public banking can prevent the 
largest part of failures that occur in times of panic. 

Take the latest general panic we had — 1893. Horses, at 
the home market, depreciated over half in value in less than 
6 months; stock cattle also, and farm values dropped over half 
in value and there was no perceptible recovery for many years. 
Town property all through Kansas, at least Central and Western 
Kansas, was simply dead property and could not be sold for 
cash at any price. I don't want to dwell on the horrors of those 
times! No one knows the number of homes that were lost and 
broken up during those years. 

I only want to say, when a panic comes ag-/:n, and it is sure 
to come unless we change our finance system, it will be even 
more destructive than the panic of 1893. In April, 1893, a few 
months before the panic started, the bank call gave for Kansas, 
447 state and private banks, with deposits of $21,977,914, and 
reserve fund of 56.32%. After the panic banks kept decreasing 
in numbers, till December 24, 1897, when there were 372 left. 
Now we have 899 state and private banks and trust companies; 
nearly 5 times more deposits. But according to the last call, 
that I have seen, June 14, 1912, the reserve fund is only 32.20% 
and discounts over 88 millions. How long would the bankers 
State guarantee fund last if a real panic started? How long 
would the bankers be allowed to refuse to pay depositors? 

With over. 150 millions bank discounts bearing interest in 
Kansas State and National banks, at a rate of over 8%; with 
bankers' net profits about 24%; with a tremendous mortgage 
indebtedness on farms and city property bearing generally from 
6 to 8% interest; can we expect anything else but a general 
panic, in other words, liquidation by bankruptcy? This is the 
method by which the wealth is concentrated, the way by wh^'ch 
the big fish swallow the small ones. To better understand read 
again the history of the First National Bank of New York as 
given on page 35. There is reason in all things. Experienced 
financiers understand that panics must come to liquidate the 
steadily increasing volume of debts. They possess inside in- 
formation regarding the volume of debts. So far they have 
been able to prevent any complete collection and tabulation 

42 



of all debts. The combination of bankers and officers of in- 
surance companies may at times loan more money outside of 
bank discounts, than is loaned by banks. These combinations 
can delay or hasten panics but they can not entirely prevent 
them. The combined bankers can always make big profits out 
of a panic because they can time it and prepare themselves for it. 

With government banking, accurate knowldege of all out- 
standing debts V ould be one of the first measures required and 
accomplished. Then there would be only the debts made through 
the government banks, and an account would be kept of all the 
old debts cancelled. All these transactions would at regular 
intervals be tabulated and published. There would be daylight 
on this very important subject. 

The directors controlling the entire government system of 
banks could, by organizing a system of business and farm re- 
ports, have reliable information at all times regarding business 
conditions and, through their power to control interest rates 
and credits, could always prevent violent fluctuations in business 
and prices. Real prosperity of a people means steadiness in 
volume of money and credits, assurance of the same policy and 
constant efforts to discourage and prevent speculation. 

The rewards of business, manufacturing and farming should 
go to those who are the most efficient in doing things the best 
way; and to those who ha,ve the initiative to plan and start new 
ventures, use new inventions and scientific discoveries, to at- 
tain higher achievements in any direction; and not to the mere 
accumulation of great capital, through reinvestment of dividends, 
interest and rents. 

Some will ask, would not the adoption of government bank- 
ing, and the low rate of interest for money, drive capital av/ay 
from our country to foreign countries? I think not to any great 
extent. Capitalists have bought millions of bonds bearing only 
2% interest. Postal Savings Banks pay only 2% interest now, 
and deposits are- steadily increasing. In most foreign countries 
incomes are taxed at much higher rates than here. Opportunities 
for investments in all kinds of business enterprises are better 
in this country than in foreign countries. No one can tell the 
extent of the new impulse in all branches of industry, if all the 
able, bright minds that are now almost entirely devoted to sim- 
ply manipulating stocks and bonds, running the price up or down 
as is to their interest, by any kind of rumor or argument, were 
compelled to use their capital, their intelligence, their push, 
energy and initiative to promote and operate some real and 
useful industrial undertaking. And greatest of all would be the 
moral benefit to them to be actually attending to useful occupa- 
tion, producing things that are of general benefit to mankind. 

It is sometimes stated that we need the stock exchange to 
finance big business. I think this is a mistake. One of the 
largest industries we have, the iron industry, was in the most 
flourishing condition before the organization of the Steel Trust. 

43 



There had been for a series of years steady increase oi output, 
and a tremendous increase of foreign business. This had been 
accomplished without any especial organization to boom stocks 
and bonds, and with many comparatively small plants in op- 
eration. Through the organization of the Steel Trust, by buying 
up some plants at three times their value, and then injecting 
about $700,000,000 of water into the stock, the concern was 
crippled and it took many years to bring the business to its 
former output. Before the organization of the Steel Trust the 
manufacturers devoted their time and energies to actual pro- 
duction. When the steel trust era developed, manipulation of 
stocks, securing control of iron ore deposits, coal mines, trans- 
portation companies, etc., became the principal business. In 
these manipulations the big fortunes were made. 

By government banking every legitimate demand for money 
could be supplied through the government banks, and I venture 
the assertion that we would need no new issues of money, except 
as the volume of business increased; yes I think we might have 
an increase of 25% in the volume of the entire business of the 
country before any increase of the volume of money would be 
needed. Of course there would be no difficulty whatever for 
the government to obtain more money, if there was any need 
of it. The government credit is good beyond all doubts, and 
could be used any time for new issues. 

To illustrate: If a large city, having waterworks, could in- 
vent a process by which all the water used for any purpose, could 
be collected in a reservoir and purified again, and pumped in 
the supply reservoir, the city would need no outside supply, ex- 
cept sufficient for the increase of population. The original supply 
would need to be large enough to last until the process of col- 
lecting and purifying the waste water could be accomplished. 

Government banking would furnish that reservoir for the 
people's money. All the money in the country, after being used, 
would quickly find the way into the general supply reservoir, the 
banks. In the matter of money supply we need only one reservoir, 
— the banks. Suppose a railroad needs 50 or 100 millions; it 
would have only a slight effect on the condition of the banks. The 
railroad company would check out the loan, the checks would 
in a few days, some of them the same day, be deposited in some 
bank again. The so-much-talked-of scarcity of money on account 
of moving the crops, would have no effect on the condition of 
the banks. The grain dealer might have to borrow from a bank 
to pay the farmer for his grain, but the farmer would deposit 
his check again in the bank. With perfect confidence in the 
solvency of government banks, Math all jealousy between banks 
removed, with no necessity for large reserves, and a ready trans- 
fer of credit to any bank, the use of checks would be largely 
increased and the money to effect exchanges much reduced. 

We can have a money and banking system that answers all 
purposes, that can supply all legitimate demands for money at 
all times, by adopting government banking. No man needs fear 

44 



that he can not obtain credit as long as he is solvent; if men 
would still fail in business it might fairly be supposed their own 
fault. 

On the other hand it would be harder for promoters to obtain 
money for dubious projects than it is now. Laws with a severe 
penalty should be passed for any bank officer to receive a bribe 
to grant a loan. The giving or even offering of a bribe should 
be considered a crime punishable with imprisonment. I think 
notwithstanding much talk about the general corruption of pol"- 
itics, there are few corrupt practices among public officials. The 
Post Office department, the Revenue Service, the Army and 
Navy officers handle large sums of money and there are very 
few scandals. Fraud and corruption are mostly found where it 
is impossible to produce convincing proof, where contracts are 
let or privileges granted through laws. Where men handle 
money by proper bookkeeping every error can be found and 
frauds discovered. The only point would be in accepting and 
giving bribes for improper loans. That point should be properly 
safeguarded. 

There is no reform measure that could accomplish as much 
to reduce the high cost of living and benefit the industrial life 
of all classes of our people as the adoption of government bank- 
ing for the public good. This is the foundation stone of all 
other reforms and the easiest to put into practical operation. 
When this is accomplished then all other reforms will become 
easier. 

But I hear a working man exclaim, what good will it do me 
if interest rates are lowered so that farmers, merchants and 
manufacturers can borrow cheaper money. 1 can not borrow 
because I could not give security. There are more working men 
than farmers, merchants and manufacturers combined, and their 
interest should be considered in every reform measure pro- 
posed. While it is true that a man who can not give security 
could not borrow money from a government bank, it still remains 
a fact that all working men would be greatly benefitted by gov- 
ernment banking for public benefit instead of private profit. 
Government banking by lowering interest would save enormous 
sums to borrowers which would result in lower prices for all 
kinds of goods, and higher wages for the workers. Again by 
lower interest rates many working men who have saved part 
of their wages would leave the ranks of wage earners and be- 
come self employers in various avocations, thereby giving bet- 
ter opportunities to remaining wage earners. 

The change from the present banking for private profit to 
banking for the public good is in itself quite easy to accomplish. 
To arouse a public sentiment sufficiently strong to pass the laws 
necessary to make the change is a task that will try the metal 
of the American voters. It is true the numbers of those bene- 
fitted by our present finance and banking system is compara- 
tively small, but their influence is large. It will be the largest 
task the American voters ever undertook but it is not impos- 

45 



sible. Just try to realize the enormous burden that banking for 
private profit throws on the masses of the people, the injustice 
of it, the train of misery that follows in its wake; yes, the dis- 
grace to the many to allow the few to rob them by this system. 

The question will be asked, if interest is such a very dan- 
gerous thing why not abolish it entirely. It will be just as easy 
to do away with it altogether as to reduce it half or two thirds. 
There is no man living now wise enough to know whether there 
ought to be any interest on money, or what the rate should be 
if interest is charged. The necessary expenses of banking would 
naturally have to be paid by the borrowers, but whether even- 
tually those who deposit money in the banks will get interest 
is another question. We need not worry about that. After we 
are fairly started in looking at the government as really existing 
for doing something for the masses instead of only for the 
classes we will form the habit of observing the tendencies of 
measures. We will have experts to observe, tabulate and publish 
facts about the public welfare. We will know about 
the income of the workers, the cost of living, the 
amount of debts, the amount of interest, dividends, rents and 
profits annually paid. We can then find out what effect interest 
rates really have. There may be times when it will be neces^ 
sary even with banking for the public good to raise interest 
rates to check undue expansion of business. But no corpora- 
tion or person must be permitted to gather fortunes by the ruin- 
ous power of compound interest. If occasions should arise when 
high rates of interest should be charged the income from 
it should go to the public treasury, not to private parties. 

Banking with only the object of public good, will furnish 
the means and methods of observing the effects of low interest 
on business, on farming and manufacturing. Indiscriminate 
credit at a low rate of interest to all who could give good secur- 
ity would undoubtedly lead to the wildest real estate specu- 
lation imaginable. This must be guarded against and I will have 
more to say on that subject in another chapter. 

Government banking could and should help all who are now 
in debt, but in a condition considering their property, their char- 
acter and business ability, where they have a reasonable prospect 
of working out, and saving themselves from bankruptcy, if they 
could have time and a low rate of interest. There are now mil- 
lions of such among our business men, farmers, and mort- 
gaged home owners in the cities. The nation can ill afford to let 
men lose their all if a panic comes, as it is sure to come sooner or 
later under our present finance and banking system. When men 
are hopelessly in debt it would be useless to give them credit; 
it is even better for them to take a new start. 

The general aim of government banking should be to dis- 
courage debt making, and being without desire to make profits 
that policy could readily be adopted. I think as a rule new 
ventures in business should not be encouraged by loans from 
government banks. Let those who desire to start new business 
do it with their own capital. 

46 



One class of would-be borrowers ougM always to be encour- 
aged consistent with safety of the loan. I mean the man who 
wants to buy or build a home whether it be a farm or city 
home. We ought to use all proper means to change the present 
tendency of having increased numbers of renters. 

For the present we ought to pay at least the same rate of 
interest as the postal savings banks pay; it is very important 
that there should be encouragement to those who desire to save 
some of their earnings. 

The desire to acquire property and some return from it is 
almost universal in the human mind and it is especially strong 
in what is usually called the middle class. A strong healthy 
middle class is the real backbone and strength of a nation. The 
desire to save some of the earnings and invest them for use in 
old age is I think a very useful and healthy characteristic. The 
last half century this trait has been over stimulated, and through 
this there was built up our present system of monopoly and 
the concentration of wealth. This we must stop if we want 
to save the nation; but the desire to acquire, to save, to be able 
to rise a little higher, obtain better opportunities for the chil- 
dren should be encouraged by wise laws. 

We can assist the men of small means by a different method 
of dividing the public burdens from the present one. Now even 
the poorest are obliged to pay for the support of the government 
when they buy their necessities through indirect tax. The poor 
man with a mortgage on his property must pay the full tax 
on the value of the property. This is discriminating against 
the poor. The protection of property is one of the main func- 
tions of government and the expense of the government should 
be born by property. This brings us to the subject of taxes. 



47 



TAXES. 



There is quite a large number of people who think that tax 
reform as they see it would cure nearly all our economic evils. 
The Single Taxers propose to raise all public revenues for Na- 
tional, State, County and municipal purposes by a single tax upon 
land values, irrespective of improvements. 

They would abolish all indirect taxes like tariff, internal 
revenue, taxes on personal property, buildings, machinery, 
stocks of merchandise, live stock, banks, mortgages, bonds, 
shares in stocks and money. 

I will not try to refute the beautiful sentiment, about God 
making the land for all his people, but I do think that most 
of the active single taxers, who write and speak for the single 
tax, if compelled to take their share of land, and make their 
living on it, and pay the taxes on a basis of single tax, would 
run faster than they ever have before to get away from it. 

I would like to know how in a new country like Kansas was 
50 years ago, taxes could be raised on the rental value of unim- 
proved land, when unimproved land had absolutely no rental 
value, yet even the pioneer settlers must raise taxes for schools, 
roads, bridges and public building". 

The single taxers constantly assert that the real farmers 
who work their own farms would pay less taxes under single 
tax than now. Another delusion of impracticable dreamers. Fig- 
ures are stubborn facts. 

The report of the Kansas Tax Commission for 1912 gives the 
following figures. 

Total value of farm land $1,228,702,127 

Total value of improvements on farms.... 129,416,790 

Total value of personal property 517,350,932 

Total value of public service corporations. 431,209,399 
City lots with improvements 440,281,647 



$2,746,960,895 

Taxes are from .0070618 to .0176815 on a dollar. 

The separate figures for improvements on city lots are not 
given, but in our Kansas towns lots are not extremely high. I 
think the buildings would average half the value of the assess- 
ment of city lots. 

48 



Public service corporations with single tax in force would 
pay very little in taxes. There was in 1912, 9102 miles of main 
track railroads in Kansas and 2,613 miles side and second track. 
That would be about 60,000 acres of land to be taxed for the 
railroads. The average value of farm land for the whole state is 
$24.21 per acre. Suppose we value the railroad right of way land 
at $100 per acre and we obtain $6,000,000. So under single tax 
we would have to deduct from our assessment 

Total value of farm improvements $129,416,790 

Total value of personal property 517,350,932 

Deduction on public service corporations .... 425,209,399 
Half the value of City lots 220,140,823 



$1,292,117,944 

From these figures and they are the actual figures on which 
the taxes of Kansas are levied and must be paid we see that if 
personal property and improvements on land would be exempted 
that only a little over half the property assessed and taxed now 
would remain. Of this only $220,140,823 would be taxed on the 
city lots, 5V2 times more on the farms than on the cities. 

But there would be another very serious discrimination 
against the poorer class of farmers through the single tax. The 
poorer class of farmers have cheap buildings cheap farm ma- 
chinery and less live stock than their more wealthy neighbors. 
The wealthy farmers have fine expensive houses, barns, gran- 
eries, the best farm machinery and implements, the best live 
stock, often hundreds of cattle and hogs for fattening, also fre- 
quently bank-stocks, notes, mortgages and moneys, and don't for- 
get the automobile. It is not unusual to find farmers whose per- 
sonal property and farm improvements are assessed higher than 
his land, while with the poorer class of farmers the land is the 
principal item in the assessment. The same condition is found 
in the cities. The man who has a few lots in the suburbs of a 
city with a cheap house would have to pay part of the taxes 
for the man who has a large business block in the city. If the 
federal taxes were also assessed against the rental value of un- 
improved land, that would nearly double the taxes again. 

The single tax under present conditions would increase the 
taxes on all but the wealthiest of farmers, the less a farmer had 
of buildings, stock implements and other personal property, the 
more his taxes would be increased. This is a self-evident fact. 
Bankers and other money loaners, manufacturers, packing 
houses, merchants with their millions of merchandise would be 
practically exempt. 

I am not blind to the evils of land monopoly and specula- 
tion in land, but to try to cure the evil by single tax would 
put still heavier burden on a large class of struggling farmers 
and house owners in cities, who are financially unable to prop- 
erly equip their land holdings. 

Now if we obtain government banking for the benefit of the 

49 



masses as we surely will before long, that will undoubtedly cause 
a rush of capital to land and cause a rise in land values. This 
would be an unmitigated evil for the real farmers and for the 
best interests of the great majority of the people. Not only this, 
but it is almost universally admitted that all proper means should 
be used to encourage people to go back to the land. Cheap 
money, lower rates of interest would help the farmers, but higher 
prices for land, operates against those who would become farm- 
ers. 

We have been accustomed to live under a system of taxa- 
tion where the greatest burden of taxes rests on the compar- 
atively poor. For our State and local taxes we have been and 
still are compelling the man with a mortgage on his farm or 
house in town, to pay the full tax on his property, although he 
may own only a small equity in it. This Is taking from the poor 
to give to the rich. We should pass a law to permit every 
man to deduct his mortgage indebtedness from his assessment. 
Where there is poor land the farmers are compelled to pay their 
own school and road taxes, do not even get their share of th^ 
railroad taxes. Our federal taxes, until the income tax recently 
enacted were largely raised from tariff which is paid by the con- 
sumers. There should be a radical change in this; the poorer 
classes should be favored instead of the rich. 

Taxes should be levied directly on property. Even with a 
changed finance and banking system, with the power of capital 
to increase through interest greatly reduced, there would still re- 
main a great advantage in the industrial struggle with those 
possessing property over those who have only a small amount of 
property or none. For this reason and also as a check to land 
speculation we should give an exemption from taxes on any form 
of property to all married men, widowers or widows of at least 
$1,000. 

If land speculation and advancing prices would still continue 
we could pass a graduated land tax, which would be another 
check. 

At the present time tariff agitation ought to rest, but an un- 
partizan tariff commission should gather and compile facts re- 
garding the cost of goods, cost of labor and everything hav- 
ing any bearing on prices and tariff duties. In abolishing a 
tariff system of long standing we can afford to go slowly and 
give manufacturers time to adjust themselves to new conditions. 

Under government banking manufacturers could obtain re- 
duced interest rates which would greatly cheapen the cost of man- 
ufacturing. Railroads could give cheaper freight rates because 
they could have lower interest rates and we would not permit 
them to draw dividends on watered stock. This again would help 
manufacturers to produce goods more cheaply. I think with free 
raw material, cheaper interest rates than E'lropean manufac- 
turers have, and greatly reduced transportation charges our man- 
ufacturers would be able to meet any competition in the world 
and still make reasonable profits. If an unpartisan commission 

50 



would then find that certain industries could not meet foreign 
competition, they should make their report and if congress should 
deem it in the best intei;est of the public then congress ought 
to make a law to give a bounty to such manufacturers sufficient 
to enable them to meet competition. This bounty should be 
paid out of public funds raised by taxes. 

The consumers are entitled to free competition to secure 
them the lowest possible markets, but as I stated before, we 
have now a tariff law going in the right direction and we ought 
to give time for a proper adjustment to it before we try new 
changes. 

Regarding the single tax I think every state ought to pass a 
law or constitutional amendment if necessary to give the priv- 
ilege to cities or counties to adopt single tax or a modification 
of it, but of course pay their share of state or federal taxes 
on the basis of an assessment of all the property. 

There are cities where land speculation is running high and 
strong financial interests combine to keep prices of lots at un- 
reasonable and artificial prices, where single tax or limited single 
tax would be a benefit, provided that the exemption mentioned 
before to heads of families would be granted. 

After w^e have obtained a finance and banking system for 
the public good instead of, as at present, for private profit; trans- 
portation at cost or at least with only a reasonable profit to the 
owners; efficient laws and prompt enforcement against any mon- 
opolization of business that causes artificial or monopoly prices, 
then I tnink we could dispense with all taxes except on Real 
Estate and a reasonable graduated income and inheritance tax. 

It is not advisable nor practicable to divide the land equally 
among all the people, because a large majority of the people 
do not wish to work on farms and could not make their living 
if they tried. Yet every fair minded person must admit that 
each person born has a natural right to the use of some land. 
The fact that over half of our population does not wish to en- 
gage in working on land and that in our present industrial de- 
velopment it would not be best, does not mean that those who 
occupy and use the land should have all the benefits of it when 
benefits begin to accrue. 

But I have shown in previous chapters that under our pres- 
ent monopoly system, the manufacturers, transportation com- 
panies and bankers have obtained special privileges and through 
financial manipulation have actually created interest or dividend 
bearing paper that obtains more of the real wealth than all the 
farmers can produce by their labor, while the farmers with 
their $40,991,449,090 of invested capital have hardly fair wages, 
without any return for their enormous capital. Under these 
conditions it seems unjust to remove the taxes from the man- 
ufacturers, the transportation companies, the owners of great 
business blocks the bankers and money loaners. 

The power of monopoly and special privilege takes many 

51 



forms, and any one of these forms is capable of absorbing the 
fruits of labor above the mere living requirements of the work- 
ers. The industrial and economic development of our country 
during the last 50 years gives an object lesson that all but the 
blind can see. 

Through the enormous increase of labor saving machinery 
we have increased our capacity for producing everything man 
needs, food, clothing, houses, luxuries so our ware houses are 
always full and yet the great majority of our people have ser- 
ious difficulties to obtain the mere necessities of life and millions 
of our people are below the line of being able to procure the 
decent essentials of life. Superficial thinkers or those without 
knowledge of necessary facts, seeing the enormous prices for 
lots in our large cities and the fabulous ground rent that build- 
ers pay for building sites, think that land monopoly is the cause 
of all our economic troubles. It is an evil everywhere but under 
present conditions only a minor evil, especially when compared 
with the evils of finance and banking system. 

In large cities rents are naturally largely affected by the price 
of lots, also by the rate of interest and the average rate of divi- 
dends that capital obtains in other investments. Parties who put up 
expensive buildings for rent or for their own use are business men 
who invest their money on business principles. Their number is 
comparatively small and they can easily make agreements about 
rents. I have no sympathy for the man who holds lots out of use 
simply to get a higher price. I really think such instances 
are few because it seldom pays, as taxes are always high on 
valuable lots. 

It often occurs in cities that a lot owner has a three story 
building not new who gets a fair, but not large income from 
rents. He is not financially able to tear it down and build a 
modern sky scraper as some of his neighbors have been doing. 
Under single tax this man would have to pay the same amount 
of tax as the owner of a fifty story building, who probably gets 
five times greater net income from his building. 

Individuals or corporations do not build modern business 
blocks from philanthropic motives. They are built on business 
principles with an expectation of profit. 

To enact a law for single tax would mean a donation of 
millions to the owners of the best and most profitable buildings 
in large cities, and a correspondingly larger tax of the same 
amount to those having cheaper buildings on their lots. If a 
law could be passed to raise taxes only on vacant land there 
might be some justice in it but that can not be done. 

From this, it can be seen, that what the advocates claim, 
could not be accomplished by single tax. An exemption of $1,000 
to the head of every family would accomplish better results and 
would be more fair. 

The farmers who own their own farms are still in a ma- 
jority although a steadily decreasing majority; but the most stu- 

52 



pendous fact remains — these farmers, a large proportion of whom 
got their land without price, who always produce more than all 
our people can consume, these farmers who nave invested over 
40 billions in their farms, obtain as a return for all their labor 
only an average of $437 a year. If the farmers would charge 
interest on their own capital at the same rate they must pay 
for their borrowed money, it would amount to about half the sum 
of the value of their total products and cut their income in two. 
But a single tax writer in a recent article in a newspaper stated 
that the increase of ten billions in the value of the farms was the 
most stupendous instance of inflation of values. I would admit 
this if the producers had to pay dividends on it, but they do 
not. Prices of farm products do not rise or fall with the price 
of land. 

Land values in New England and the Middle Atlantic states 
have increased but slightly during the last two decades while 
they have increased enormously in the south and west, but the 
farm products in the Eastern States are always worth more 
on the farms than in the West. The grain from the cheap lands 
in Washington the Mountain States and Canada all go to the 
same worlds markets and the difference in price on the farms 
is only the difference in freight. 

Serious shortage in any crop raises prices but even this 
year 1913-14 wheat prices are lower than they have been at dif- 
ferent periods when land values in the Middle West were less 
than half what they are now. 

Many competent and successful farmers if they consider 
only the money making stand point sell their farms for more 
profitable investment of their capital. By merely loaning their 
money at current rates of interest they often can double their 
income without the hardships and risks of farming. Others add 
business to farming, buying and selling farms, buying and feed- 
ing live stock. There are farmers who obtain fair interest on 
their investment but their business ability, working power, and 
money making habits are above the average, but what they make 
naturally reduces the amount that others get. The principal 
reason that farm population is proportionately decreasing will 
be found in the fact that farming brings no return to capital, 
except when there is an increase to the value of land. 

This increase in the value of land which is really detrimental 
to farming considered as a whole, furnishes generally the glowing 
accounts regarding the prosperity of the farmer. High priced 
farms do not mean larger crops nor bigger money returns to 
farmers. It means greater difficulty for would be farmers to ob- 
tain land. 

Whether a very large increase in taxes would attract many 
new farmers from the over-crowded cities seems to me very 
doubtful. It would be a great injustice to those who are farming 
now to double or treble their taxes. This the single tax would 
do under present conditions. 

53 



SOCIALISM. 



To Socialists we must give the credit of keeping up a steady- 
persistent and very energetic agitation against the evils of cap- 
italistic oppression. Socialists never stop their agitation; their 
lecturers are traveling in every state of the Union, speaking 
wherever opportunity offers and the members of their party are 
always ready to assist in promoting their cause. 

They are meeting with great success in showing the evils 
of our present economic system regarding the unfair distri- 
bution of the products of labor. This is a necessary work to 
be done before any reform can be accomplished. The man who 
is satisfied with his condition, with the laws and customs will 
not vote to bring about a change. A noble discontent with 
wrongs and right efforts to abolish them is one of the means 
of human progress. 

I agree with the Socialists that we must curb the power of 
capital but not that we should confiscate. I believe we should 
socialize our finance system and have government banks con- 
ducted entirely for the public good instead of private profit. 
I believe with them that we should abolish all special privileges 
and every restriction of trade as soon as possible, but I do not 
believe that it would be wise or to the best interest of the peo- 
ple, for the government to take over all the production and dis- 
tribution of wealth, as they propose in their platform. 

I think the socialists make a great mistake in trying to 
arouse a class spirit, in order to win the battle against con- 
centrated wealth. We need and must have the assistance of 
votes from all classes. It is right and proper to appeal to the 
self interest of the voters, to show them how they are wronged, 
and how certain changes will benefit them. But the line of ar- 
gument that will eventually carry us to victory is the appeal to 
the sense of justice, slumbering perhaps but still present within 
every normal human being. 

Very little progress has been made yet in passing laws 
to curb the influence and power of capital, but great progress 
has been made the last few years, in bringing the political power 
back to the masses through laws for primary elections, the Ini- 
tiative, Referendum and Recall in many states. 

No man living now can tell how far the people will go in 
socializing the industrial and commercial affairs of the nation. 
The people are absolutely supreme. 

54 



We have the school system on that basis now and all we 
need is a better general understanding and appreciation of the 
importance of extending and broadening our school system until 
every child shall not only have a good primary education but 
also an industrial education that prepares it to become a self- 
supporting citizen and an intelligent voter. 

We have the Post Office socialized with a Parcel Post added 
to it and a beginning in Postal Savings Banks. Telegraph, Tele- 
phone and later on all transportation will undoubtedly follow. 

We need laws to improve our land tenure but I believe we 
can do more good in that line through taxation. We must not 
forget that practically all the land has been bought and is owned 
by individuals and land owners have always been very tenacious 
in holding their lands. , . 

There is absolutely nothing to prevent the socializing of 
any part of our industrial system, if the voters can be convinced 
that it is right and just. But whoever has a true knowledge of 
human nature must understand how very slowly the masses of 
the people can be changed and how difficult it is to bring into ac- 
tual and successful working order any change that has been 
adopted. 

I think Socialists ought to see that the only practical plan 
is to try the easiest changes first. To change our entire Fin- 
ance system from banking for private profit to banking for the 
public good would be a comparatively easy task. It would require 
no change in the habits of the people. Trained men to do the 
work would be on hand. They would be just as willing to work 
for the government as for private parties. 

Another easy step that would save millions for the people 
would be government insurance. Nothing but intelligent vot- 
ing is needed to accomplish it. Some states have it now. 

Municipal ownership of water works, light plants and street 
cars has been tried and is generally successful. We must not 
forget that the people are absolutely supreme in these matters. 

But to a practical man who is not simply a dreamer who 
tries to analyze the methods and details by which things can and 
must be done, the idea of socializing the millions of merchants, 
manufacturers, hotel and boarding house keepers and the farm- 
ers, seems certainly at present an impossibility. The govern- 
ment might buy and drain swamp lands, and experiment with 
big farms, using every scientific method known, then observe 
results. It would no doubt pay. If it was a success not only in 
dollars, but also in better conditions in all respects, financially so- 
cially and intellectually for the workers it would undoubtedly 
be gradually extended and might in time become general. But 
such changes can only come after thorough demonstration. It 
would really be co-operation assisted by the government. 

The same principle applies to commerce; if the government 
can not prevent combinations that maintain monopoly prices, it 

55 



may become necessary for the govermnent to establish stores to 
prevent combines resulting in unreasonable profits, or it may be 
done by direct establishing of maximum prices. 

The question of socialism will and must be decided by the 
natural and inherent traits of human nature. The ruling charac- 
teristic of human beings is the desire for freedom, for the priv- 
ilege of free action, free expression in every phase of life. This 
desire is often suppressed in individuals by modern conditions so 
that we find hardly a trace of individual thought or action left; 
but even among such if they have children this Grod implanted 
love of freedom will strive again toward attainment. 

It is this intense individualism and love of freedom that 
has spread our population over our whole country and opened 
farms where no man can farm successfully. There are millions 
of farmers living on our frontier farms where they must and do 
endure more hardships and privation with smaller returns for 
their labor than any other class of men, but they enjoy a certain 
kind of freedom. 

It is true that great gains in production are made by the 
using of labor saving machinery and the systematising of labor. 
There is no question that mucn greater returns could be obtained 
from our farms by the use of more machinery, better organized 
and more scientific application of labor. But the question is how 
to obtain it. 

While we are low in production per acre, we have been and 
are making progress. We are leading the world in the amount 
of products we raise on our farms to the number of persons 
employed in farming. 

To try arbitrarilly by edict of law to radically change our sys- 
tem of private ownership to public ownership would be a task 
of such magnitude as has never before been attempted in the 
history of the world, and I think utterly impossible of accomp- 
lishment. 

There are some things that must be done by our government 
directly for the benefit of a majority of the people. Among these 
I consider first and of most importance the altering of our en- 
tire finance and banking system. Next all kinds of insurance 
except co-operative or mutual.. Then transportation including 
telegraph and telephone. But the socializing of our finance and 
banking system should come first; it is most important and far- 
reaching. 

All these changes could be accomplished without causing 
any perceptible change in the habits of the people. Banks are 
nearly all incorporated, and most of the work is performed by 
employees. The same is true of Insurance companies and rail- 
roads. It would only require a change of ownership, and a 
change from trying to make all the profits possible, to a policy 
of serving the public, to the best of their ability. The owners 
of the banks and the Insurance Companies and of the Railroads 
are often engaged in other business, are usually good business 

56 



men, generally wealthy, and therefore quite able to take care of 
themselves, by entering some other avocation. 

But to change the method of farming, make all the farmers 
employees of the government would be a task that ought to be 
well considered before it is undertaken. 

There are still over six millions of farmers who in a certain 
sense are their own employers. A million of merchants, prob- 
ably a million of small shops, carpenters, blacksmiths, shoe 
makers, hotel and restaurant keepers, boarding house keepers, 
tailors, barbers, jewelers, etc. They seem to hold their own 
among all the concentration of business trusts and combines, and 
I believe it is for the best interest of the country that their ex- 
istence continues. 

I believe every encouragement should be given to increase 
the number of men who are home owners and self employing. 
Through the government banking and very low interest rates 
an outlet for salaried men and working men who have saved 
some of their wages, and would like to become self-employers 
will be found. As farmers, fruit raisers, poultry men or in 
other avocations, they will leave the ranks of wage earners, and 
better opportunities will remain for the other workers for steady 
labor at good wages. 

It is generally admitted that country life produces the best 
manhood and womanhood we have. The cities not only get their 
supplies of food and other raw material from the farms, but 
also their supply of fresh, unpolluted, vigorous manhood. It is 
a well known fact that there is a great tendency for men to 
deteriorate in the city. The extremes of wealth as well as the 
extremes of poverty tend to lower physical and moral standards. 

A large vigorous independent middle class is the hope of 
a nation. Every proper means should be used to encourage the 
wage earners to become members of this class. 

I would not ask socialists to give up their ideal that so- 
cialism points the way to a higher and better condition for the 
masses of the people. All I would ask of them is that when any 
measure like socializing our banking system, our insurance sys- 
tem or our transportation comes before the people at an election 
that they should do all in their power to assist in carrying it 
through. 

They surely ought to understand that socializing all the 
production and distribution of wealth if it ever comes will re- 
quire generations of time. Laws may be passed under great 
political excitement, but to put them in practical operation is a 
proceeding that needs time, patient effort and practical exper- 
ience. 

Socialists generally consider competition as one of the evil 
influences of our industrial system. It must be admitted that 
competition in the past has often been ruinous to many business 
men, but that has generally been because competition was not 
fair. 

57 



We have had too many special privileges in our industrial 
and commercial life. Combined capital has ruled politics and all 
manner of special privileges have been given during the last 
half century. Because of abuses of granting special privileges, 
such as the government giving banks the privilege of receiv- 
ing money for their bonds, and still owning and drawing inter- 
est on them; chartering banks to receive deposits and allowing 
them to charge most any rate of interest on the money of their 
depositers; allowing railroads to charge all the traffic will bear, 
permitting them to give rebates and passes, allowing all man- 
ner of combinations to make artificial prices ; the result has 
been our fair competition has been killed. But because a good 
thing has been abused does not prove that it is not useful and 
beneficient under proper conditions. 

I think fair competition is the life of business and the mother 
of progress in our industrial life. Give every business man 
and every farmer the opportunity to borrow money at the same 
low rate every other man has to pay, the same freight rate under 
the same conditions to all and business and farming would ad- 
vance as never before. Whatever benefits business and farm- 
ing will also benefit those who work for wages. 

The love of competition, the wish to excel in doing things 
a little better than others, is ingrained in every normal human 
being. It is present in the play of children, and especially in 
games like base ball, foot ball, boat races, running, wrestling and 
boxing. There is no limit to what men will do to win in a game. 
All that is needed to keep competition from doing harm is to 
see that it is fair with no especial favors. 

Fair comi>etition in business stimulates the sluggard, re- 
wards the wide awake, benefits all because those in advance 
with better methods teach those in the rear by example. The 
stimulus of competition is the principal cause of progress in 
all lines of human activity. 

In conclusion on the subject of socialism I would say that 
no one can forsee now what will be done in 50 years fram now. 
If the people can be aroused to action and throw off the yoke of 
our financeers and stock gamblers then we may hope, that they 
will stop other forms of monopoly. The voters will gain con- 
fidence, they will begin to understand their power and will car- 
ry into effect any reform they wish. If they want State So- 
cialism as it is defined now, there is no power ta prevent it 
under our form of government. As intelligence increases among 
the voters they will learn how to get what they think is good 
for them in the way of reforms. I believe that the American: 
people will go no farther in the direction of Socialism than pub- 
lic ownership of public utilities. 



58 



EDUCATION AND AMUSEMENTS. 



A most urgent need to make life more attractive and in- 
crease the efficiency of our citizens must be met through ed- 
\ication. There is much more intellectual equipment required 
to make a good farmer or business man than therfe was even 30 
or 40 years ago. 

On the land this higher knowledge ought to be obtained by 
the children without leaving home. To send boys and girls from 
liome after they pass the 8th grade, when many of them are only 
14 to 15 years of age is unwise and often brings evil consequences. 
It seems the temptation to go wrong even in the smaller towns 
is constantly increasing. Boys and girls of that age are gen- 
erally too unsettled in character, and too ignorant of the dan- 
gers and temptations of city life to successfully meet them. 

The great majority of farmers can not afford to educate their 
children any higher than the home school. It costs over $250 a 
year at the lowest estimate to send any child from home to 
school. The country needs first, continuation schools for the 
"Children who can not go away to higher schools. 

These continuation schools should be conducted on a plan 
entirely different from the common schools. One to every four or 
six country schools as we have them now in Kansas would be suf- 
ficient. There should be a good building provided with one large 
room, planned for public meetings, with a stage and movable 
seats for the audience. There should be several smaller rooms 
for reading and recitations and either a dwelling for the teacher 
or extra rooms in the school building for his use. 

This teacher should be chosen for the especial qualifica- 
tion of understanding and loving young people, for having the 
ability to get their confidence, finding out their ambitions, dis- 
covering if there is not some line of study or information that 
they are interested in, and then induce them to, study in some 
class. There should be a small but well selected library, and a 
tew of the better class of magazines. 

The studies should all be informal, irregular, perhaps and 
include the evening hours, the one principal motive being to get 
the pupils to read something helpful and instructive, and from 
time to time review with others reading the same book. 

This teacher should be able to teach singing and have chorus 
practice. As often as possible a public program of a dramatic 
and musical character should be given, and the teacher should 
have the necessary qualification to select and arrange these 

59 



programs and train the persons who read, sing or act the re- 
spective parts. These teachers would naturally try to draw some 
of the grown people into occasionally giving talks on current sub- 
jects, farm, social and economic questions. After a fair start 
there ought to be no difficulty in having at least two public pro- 
grams a month, with club, reading or social meetings of smaller 
groups possibly every evening. 

I do not know of a country neighborhood, where most any 
effort to get up an entertainment, will fail to draw an over- 
crowded house. They are simply hungry to hear any k^'nd of 
program particularly from their own people. I have often won- 
dered why these meetings and entertainments can not be kept 
up, but the cause is not far to seek. Everything requires work 
and especially when persons undertake it who are not used to 
it and really not qualified. Most of the country school teachers 
are very young and inexperienced in this kind of work, and many 
have not the strength for extra efforts. I have myself at var- 
ious times started a lyceum, as we usually call them, and just 
in proportion, as I could give time, thought and effort to it would 
it be successful. But naturally the busy farmer or business man 
can not devote the necessary time, nor has he the knowledge 
and training. All efforts of this nature are usually spasmodic 
when such work ought to be continuous from year to year. 

Even without considering the superior education and train- 
ing of such a teacher, the very fact that he or she is a teacher 
for this work would give a great prestige. When a member 
of the community takes up this work there is often some lo- 
.cal jealousy and silent opposition that would not be manifested 
in opposition to the work of a teacher. 

It is not so much a question of just what can be accomplished 
at first, as that some start is made to fill a great void in farm 
life as it now is. It is sad but true that a great many of the 
young people seem to stop all intellectual progress after they 
cease going to the public school. Many are not far enough along 
in their reading to be able to enjoy it, and read so little that 
five or ten years after going to school they can not read as well 
as when they quit school. 

If a person can be interested in reading some good book, even 
only half an hour a day, he will obtain much useful information 
and extensive general knowledge in a few years; but even that 
is not the principal consideration. The real value of it con- 
sists in the habit of spending part of the leisure time in that 
way. The person who is fond of reading good books or per- 
iodicals is pretty well insured against forming bad habits. 

A teacher would soon be acquainted with the young people, 
would find points of contact in their character and get them 
interested in a few classes. I do not think there should be 
formal examinations. An occasional review either written or 
oral of books read, so the students gradually form the habit 
of thinking, understanding and remembering what they read, 
would be more feasible. The influence of a teacher of these 

60 



schools would be helpful in gently, unostentatiously, but persist- 
ently influencing pupils to self-improvement. 

To organize and oversee amusements would be one of the 
important functions of these teachers. I have already spoken of 
dramatic entertainment; this always enlists the whole population. 
Besides there should be occasional lectures from professors 
from our colleges who are usually willing to come for the ask- 
ing. With the organization of these schools the central author- 
ities in charge should make plans to get good films and pro- 
jecting machines so that good wholesome instructive and amus- 
ing picture shows could be given in these school houses. There 
is a great fund of information and amusement in properly se- 
lected pictures, especially if a good instructor explains those 
intended for information. 

There is another form of amusement that I consider of high 
value and importance, that is dancing. Dancing is the natural 
expression of youth and joyous life. That it can be abused and 
lead to evil I do not deny. But what is there that can not be 
abused. We all know that dancing can not be suppressed. 
When young people are forced by their parents to go to dances 
clandestinely there is already harm done. Make dancing respect- 
able by having it done under proper conditions. This could be 
attained by having the dancing in these school houses. There 
would be a well ventilated, well lighted, roomy, hall, many 
of the parents would be present, and some would participate in 
the dancing. The dancing would close at a proper hour. There 
would be no all night dances at the school houses. Young peo- 
ple should not only have opportunity to dance, but they should 
be encouraged to dance well, learn it properly and have some 
pride in doing it artistically. Good dancing improves the figure, 
the carriage of the body, the walk; it helps people to meet others 
in a proper way and is in every respect a good social asset. 

I think there would be another great gain from the amuse- 
ments and other gatherings at the school houses. The com- 
ing together of the youths of both sexes in social intercourse, 
under proper conditions such as would be in these schools, is 
beneficial. Boys and girls who from the age of puberty fre- 
quently meet, talk, sing and dance with those of the other sex 
are not so apt to become subject to morbid ideas about sex 
as those who have no such opportunities and they are more 
likely to find well adapted mates in marriage than if they had 
fewer opportunities in social intercourse. In connection with 
these schools there should be either by the teacher or perhaps 
by especially qualified traveling lecturers, lectures on sexual 
knowledge for the young. 

There should also be good play grounds near the school 
house for base ball, basket ball etc. 

I have been talking about country schools and country life, 
but these schools are needed just as much or even more in the cit- 
ies. Almost every paper brings reports of young people going 
wrong by taking part in joy rides or visiting questionable dance 

61 



halls. The question of amusement for the young is just as serious 
in the cities as in the country although essentially different. 
The social and intellectual center in the school house would be 
the best solution for it in the city, also, with encouragement and 
assistance to form reading and study habits, participation in de- 
debates and lectures, in studying plays and acting in them and 
singing and dancing. These practices would also keep alive and 
develope the democratic spirit and fellowship formed in the com- 
mon schools but only too quickly lost later on. 

Expenses for these schools should be paid mostly by the Fed- 
eral Government, because there are many farm communities that 
are hardly able to pay the local school taxes now. These 
teachers ought to have salaries that would offer some induce- 
ments to make a life profession of teaching; and after they 
have proven by their work that they are qualified and efficient 
teachers, ought to have assurance of a decent pension when 
they are retired. 

Fortunately the expense of these schools could be born by 
the federal government without any increase of taxes, as the 
decrease of the pension list would undoubtedly cover the ex- 
penditure. 



62 



BENEFITS TO BE DERIVED THROUGH LAWS. 



What can be accomplished for the elevation and improve- 
ment of the race by law is a very important question. Only 
very superficial reformers think that all evils can be cured by 
simply enacting laws. Yet we are now suffering from many 
evils that are caused by laws and can not be cured until laws 
are changed. We can not escape the evils of our finance and 
banking system until we change the laws. We can not ma- 
terially reduce the evils by amendments of the present laws. 
Only a radical change from banking for private profit to bank- 
ing for public benefit can cure the present evils of our finance 
and banking system. 

The most serious part of the problem is the enormous bur- 
den of debt now resting on the shoulders of the people. The 
interest and dividends and rents that the small percentage of 
capitalists collect annually from the workers and consumers is 
so enormously large so entirely out of all proportion that it ab- 
solutely must be stopped. 

I can conceive of no way to do it, except as I have stated, 
government banking for the public good and rigorous laws to 
eliminate all fictitious values from all stocks whether private or 
public corporations. This can be done through laws, if the peo- 
ple absolutely demand it. If laws passed fail to cure the evil 
keep demanding until effective laws are passed and enforced. 
The voters have been too easily satisfied in the past, with half 
measures and empty promises. 

Even this may not prevent unreasonable profits obtained by 
combinations of manufacturers or combinations of merchants. 
By compelling manufacturers and merchants to open their 
books to inspection, government agents, either state or national, 
could determine from the books when unreasonable profits are 
charged. I think it is the business of a good government to 
investigate such matters and correct them. If the voters really 
demand the abolishment of these evils it can be done, if not by 
the first effort, by steady, persistent effort. 

A very serious and far reaching evil of the present time 
the question of the unemployed, can be cured by law and prac- 
tically at once. A law compelling every city or township to 
provide work for every man out of work and unable to support 
himself should be passed promptly. That law should only be 
the commencement and help immediate needs. 

63 



The federal government and citj^ and state governments 
could then plan and prepare all manner of public improvements 
in order to supply work for men whenever needed. When v^e 
consider that any man's work, no matter how inefficient he may 
be, is always worth more than his board and clothing it is 
amazing to think that no general provision has been made pre- 
viously to cure this monstrous evil. 

There are large amounts of money spent in charity and 
we all wish God speed to those who in their generosity give 
from their means to the needy. But those who have good op- 
portunities to observe generally agree that the results from giv- 
ing charity are often unsatisfactory. The recipients are very 
much inclined to form a habit of depending on almsgivers. The 
receiving of charity seems to weaken their self reliance and en- 
ergy. Tb guard against unworthy persons receiving aid requires 
a large corps of officials to investigate cases, which 
consumes a considerable portion of the charity funds. The 
worst feature of the system consists in the fact that the peo- 
ple mostly in need of assistance are generally to proud to let 
it be known. There are many who would rather starve than 
apply for charity. 

This would be obviated if the policy of giving employment to 
every one needing it would be adopted. A man would not need 
to lose his self respect first. He would simply apply for work 
and get it. The work might not suit, but he would keep at it 
until he could find a better job, I think the money spent in 
private charities, considering the expense of soliciting, of inspec- 
tion and administration, and the expenses of municipal charities 
would go a great way toward paying the wages of the men en- 
gaged in government work, and that work would be worth more 
than the cost. 

There are now great efforts from many sources to obtain 
better roads, but usually that means bonds, then commissions 
to bankers to sell them, then a fat slice of profits to contractors. 
Work and vote against every kind of proposition to vote bonds 
for roads. Plan your work, get the best machinery then have 
the work done by day labor, and work every man in jail and 
give every man work who can't get a job elsewhere. 

The greatest part of the task of giving work to the unem- 
ployed should, however, be done by the federal government. 
There are many good opportunities for such work. Irrigation 
plants are needed in many places. Before starting irrigation 
plants the government should always secure the land to be ir- 
rigated, if in private hands, so there will be no greedy speculat- 
ors to make fortunes from the benefits of government irriga- 
tion plants. If owners of land would refuse to sell their land, 
then assess them their share of the cost. When an irrigation 
plant is finished the government should use scientific farm ex- 
perts to farm the land and test the adaptability of the soil, 
and the best methods of farming. After fair test, rent, or sell 
to actual farmers. 

64 



Workingmen who worked in such places, after demonstrating 
that they are willing and capable of doing good work should be 
financially assisted to rent or buy land, and join the army of 
self employed. This method would constantly thin out the 
ranks of wage workers by assisting those fitted and desirous, to 
become independent. The government should not try 

to make a profit on these transactions; simply get a return for 
all expenses. All renters should have a tenure for life if de- 
sired. 

Renting under such conditions offers practically unlimited 
opportunities. Millions of families could be placed on irrigated 
farms and drained swamp lands. Not only the millions who 
would become farmers but the whole nation would be benefitted 
by this course of action. 

There is an immense amount of work that ought to be done 
on our mountain ranges and hill sides in reforesting 
the steep slopes. The annual floods and the erosion 
of the soil is an enormous loss to the nation. It is well 
known that forests on the mountain slopes are the best means 
of preventing floods. If this work was undertaken by the gov- 
ernment it would be profitable. 

The reforesting of steep mountain sides must be done almost 
exclusively by hand labor, any man can assist if properly directed. 
No doubt there are many locations in narrow vallies with steep 
mountain sides, where large reservoirs could be built for the 
double purpose of storing flood waters and utilizing it for 
water power; in short there is an abundance of work that ought 
to be done for the good of the country, that will not be done 
by private enterprise because there can be no immediate profit 
from it. This is work that the government should do, but all 
care should be taken that the benefit of such work should acrue 
to the public. 

The public welfare also demands that provisions be made 
that every child within the boundaries of our nation whose par- 
ents or guardians are unable to give them a proper education, 
should obtain it in government schools at government expense. 
These schools should be on farms where the children could be 
trained to habits of work. Besides the common school training 
they should all have industrial training of a large variety and 
those who show especial aptitude in any direction should be as- 
sisted to obtain extra instruction in these lines. No child should 
be sent out from these institutions until he is competent to 
fill some useful position and is provided with one. 

These institutions should be real homes for the children. 
Necessary discipline should be tempered with love and tender 
care. No air of charity should be present. A moderate amount 
of work each day, certain hours of study and play, with proper 
provision for amusement should be made. 

This nation must realize that human beings are the most 
valuable asset we have. We can not afford to permit men to 

65 



become paupers, tramps, or criminals, because there is no work 
for tiiem. Even less than that can we permit children to grow 
up without sufficient healthful food and clothing, dwarfing body 
and mind. God knows no class or caste and often from what 
some would call the lower classes, geniuses are born who, by 
their power of intellect or artistic gifts, bless humanity. Let 
us rise to the full conception of our duty towards every human 
being within the borders of our country. 

These simple, easily carried out laws, government banking 
for the public good, employment for all unemployed, proper ed- 
ucation and training for all children, and the continuation schools, 
would start this nation on the right road and in the right di- 
rection. Absolute want for the necessities of life would be abol- 
ished at once. The effect of the better education would begin 
to show gradually in more efficiency and in a decrease of vice 
and crime. With the fearful load that capital now lays on them, 
by excessive interest rates and dividends on watered stocks, 
lifted from the backs of the people, industry would be released 
of its greatest handicap. Monopoly once checked, the natural 
initiative, tremendous energy and inventiveness characteristic 
of Americans would have full play and free action. 

Thousands of bright, capable men now only engaged in in- 
venting and carrying out plans to get something for nothing 
would be turned to useful occupations. That feverish unnatural 
desire to get rich quick would gradually disappear and give 
room for a natural healthy desire to excel in whatever calling 
one would be engaged in. The dread fear of being without a 
job would be removed from the working man. The business man 
would not worry because a rumor of a panic might cut off his 
credit and bring bankruptcy. Professional men -.vould partake 
of the benefits of the lightened load. Even the beneficiaries of 
the present system would share in the general blessing of being 
permitted to live in a world where sin, vice, crime and misery 
would be less prevalent than now. Instead of being a fearful 
example and a warning to other nations as we are, we would 
be truly progressive, a beacon light to other nations, as we used 
to be. 

We can not pass laws to make people industrious, frugal, 
efficient and energetic. The personal characteristics of the in- 
dividual are always the most important factor. All that can be 
accomplished even by the best laws is to keep equal opportun- 
ities open for all to prevent the strong and crafty from taking 
advantage of the weak and ignorant. As we find great differ- 
ences in appearance, size and build of persons, as their mental 
and moral characteristics differ, so to a certain extent will 
their social and economic conditions differ. 

I am not one who wishes to level all differences. Var- 
iety is the spice of life. The greatest boon to man is freedom 
and an open opportunity to grow and develop himself. With 
the fear of absolute want removed, the opportunity to accumu- 
late enormous fortunes from the labor of the masses checked, I 

. GG 



think the unnatural striving for money would gradually grow 
weaker and men would begin to see that right living was more 
important than money making. They would begin to pay more 
attention to self improvement, physically, intellectually and eth- 
ically. They would strive for harmonious development of all 
the wonderful faculties with which men are endowed. 

Society can only grow and develop harmoniously when en- 
joying the greatest possible freedom consistent with law and or- 
der. The struggle of the masses, if we look backward through 
the pages of history has always been the struggle for greater 
freedom. Personal freedom, liberty of thought, speech and 
actions are the strongest traits in human nature and it is the 
business of good government to guarantee to every citizen the 
right to foster these traits. 



6t 



RESUME. 



We have seen in the preceding pages how capital by various 
methods, has fastened onto the shoulders of the people an enor- 
mour volume of debt. Fictitious stocks and other burdens an- 
nually absorb nearly half of the wealth produced in our coun- 
try. This is spread around by innumerable methods and ap- 
pears in the form of higher prices and lower returns to the 
workers. So self evident a fact needs no farther explanation 
here. 

The most important truth that I desire to impress on my 
readers is that there is no necessity for this condition to con- 
tinue. It is unfortunate that we, the voters, have permitted 
monopoly to acquire such a strangle hold on our industries, but 
we have it in our power to break that hold. 

It is a disgrace to the American people to submit to this 
tax any longer. Are the descendants of the patriots who 
participated in the Boston Tea Party, who caused the revolu- 
tionary war on account of a tax: too insignificant to mention in 
comparison to this tax that monopoly levies on the consumers, 
going to submit to this outrage any longer? Of course the 
participants of the Boston Tea Party had no representation. 
We have representation but the monopoly interests in- 
stead of the peoples' interests have had the control. A new day 
is dawning. The people are thinking. Papers and magazines 
are disclosing the evil conditions. By some good laws such as 
Primary Election laws, the Initiative, Referendum and Recall, 
the voters have gained greater power to correct all evils in our 
government if they will only learn to vote intelligently. 

But special privilege and monopoly have many weapons of 
defense, and if the voters are not alert and wide awake the 
reform sentiment now somewhat aroused will be frittered away 
by so called reform measures that mean nothing. Prune the 
tree of monopoly and it will spread the more but grub it out 
by the roots and it will be finished. 

The dissolving of trusts so far accomplished, seems to act as 
a fertilizer; they thrive better than ever after dissolution. I think 
the benefits of the new currency law will be infinitesimal to the 
masses of the people. The real kernel of the evil of our finance 
and banking system the ruinous interest rates is not even 

69 



touched upon. The bankers still control Interest rates and 
credit, it is true the last congress passed a tariff law with 
an income tax that goes in the right direction, but these should 
not be a halting station. They appear to be, judging by the 
currency law. 

No, my fellow citizens, we must no longer permit wiley 
politicians to lead us in to campaigns with mere phrases, no 
matter how beautiful they sound. We have them every cam- 
paign, changed to suit particular conditions and locations phrases 
like "a tariff for the benefit of the farmer" "a tariff in the in- 
terest of the wage earners" "a square deal" "equal justice to 
all" "a living wage to every worker" "capital and labor have 
the same interest" and all the senseless lying and boasting 
about the increase of wealth and our phenomenal prosperity. 

If we want to throw off the load that all but paralyzes our 
industrial life, that brings hunger and want to millions where 
there is plenty for all, we, the voters, must demand in no un- 
certain way that direct, definite action be taken along the lines 
I have given through these pages. 

The only way this can be done is that each voter who is 
really in earnest, who honestly desires to do his part, shall 
begin at once and work. Every man or woman has some in- 
fluence and if we take up this work in the right spirit, victory 
will soon be ours. 

Within the pages of this little book, by careful and repeated 
reading every one can find the facts and arguments necessary 
to convince any reasonable person that through government 
banking for the public good the greatest obstacle in the way 
of industrial progress would be removed. This reform should 
come first. It will make all other reforms easier. 

It is advisable not to undertake too much at once. Concen- 
tration in each campaign on one measure is the quickest and 
best method of attaining success. There is less danger of vot- 
ers becoming confused. The confusion of the voters resulting 
from unduly emphasizing some trifling question is one of the 
most successful means of defeating real reforms. 

All lovers of humanity who desire real progress must under- 
stand that economic justice, economic freedom, not only the 
right but also the opportunity for each person to earn his own 
living, must be guaranteed to all. 

Government has such an intimate relation to true progress, 
to high noble living, that every one should use his best efforts 
to lift it out of the mire of selfishness. 

For while food, clothing and shelter are prime necessities 
of life, that is not all there is of life. As stated in the first chap- 
ter, we are here as human beings to assist in carrying out God's 
plan regarding human development. Humanity has made great 
progress. We, living in this age are to a large extent the bene- 
ficiaries of it. 

70 



We have not only made wonderful industrial progress but 
have also advanced in broader views on religion, greater toler- 
ance with those who differ with us, a broader conception of 
the common fatherhood of God, and the common brotherhood 
of man. We recognize the equal rights of women in every re- 
spect. Public sentiment is more charitable towards criminals 
and we are making efforts to reform them instead of punishing 
them. And we are trying to abolish war. 

It gives food for thought to reflect on the fact that every na- 
tion in our past history has been destroyed when the concentra- 
tion of wealth has become too great. 

The one great factor that retards our progress towards 
higher and nobler living, that hinders us in lifting the nation, 
intellectually, morally and spiritually to a higher plane, is plac- 
ing the dollar above the value of human life. 

In no other country do we find so many employees killed 
in shops, factories, railroads and mines, in no other country have 
owners of these concerns so persistently opposed laws that 
would force them to use proi)er safety appliances and ignored 
state or national regulations. This spirit of lawlessness has 
spread. Our murders are more than double in percentage to 
any other nation; suicides and other crimes are in proportion. 

There is menace in a condition where there exists a gen- 
erally high average of intelligence and the idea of equality is 
ingrained in the people and supposed to be the foundation of our 
government, when there is an almost universal belief that enough 
money clears any criminal, and a general belief that the great 
fortunes have mostly been obtained by unfair means. 

The time will come when it will be a serious question to 
control millions of men out of work and without means of sup- 
port. 

All these dangers can be averted if we adopt the few sim- 
ple remedies I have outlined in previous chapters. Government 
banking for the public good; laws to check land monopoly so 
there will be better opportunities for the homeless to obtain 
land; strict and effective regulation of transportation or public 
ownership of all transportation; work for every man unable to 
get work otherwise; and a system of continuation schools to 
promote general intellectual growth. 

Now if the voters in the United States can not wake up and 
face this question of curbing capital by bringing interest, rent 
and profits on to a basis that has a proper relation to the av- 
erage savings of the people, then we must acknowledge that 
a government of the people, for the people, and by the people 
is a failure in the United States of America, We must then ad- 
mit that our noted statesman was right when he said "The puri- 
fication of politics is an irridescent dream." 

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But I am an optimist. I believe in the common sense of 
the people. I believe in their sense of justice their patriotism 
and courage, and I believe they will talk, will write, will vote 
and persuade others to vote, to make our government a truly 
Peoples' Government. 

Will you, dear reader, do your part? 



72 



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